Despite the United States having the world’s largest economy, only 57% of Americans are financially literate, according to The Tennessean. In addition to this concerning statistic, researchers found that only 37% of Americans were able to answer simple questions regarding inflation, compound interest and diversification.
Mr. Michael Merlin, founder of Merlin Wealth Management and advisor to Knight Capital, believes that the lack of financial literacy in America is an issue that must be addressed. “I think it’s really important for kids to learn how to invest early,” he said. “It’s not a class that is taught in school and I think it’s really important for there to be an avenue for students to learn financial literacy.”
When asked about the possible addition of a financial class at Pace, Mr. Merlin said that “it would be incredible for there to be a curriculum for kids to learn financial literacy, because it affects everyone, no matter what career path you take.” Although Pace Academy does not offer a financial literacy course, Knight Capital is a great alternative, as the club works towards educating students in investing while giving back to the community.
Before the school year, an anonymous donor granted $50,000 to Knight Capital for its investments. The group of over 50 students, led by junior Jonathan Merlin, meets every other Thursday during break in English teacher Robert Kaufman’s classroom to discuss where to invest this money. At the end of the year, all profits are donated to Pace Academy for student scholarships. Last year, Knight Capital contributed over $8,000 in scholarships.
During meetings, the group discusses the pros and cons of investing in different companies while “learning good tenets of investing,” as Mr. Merlin explained. “What are the characteristics of a great company? What is diversification?” are some questions that the group explores.
“We’re teaching the principals first, and then deciding how we’re going to allocate our portfolio,” said Mr. Merlin. So far, the group has invested in Microsoft and Apple and will continue to research other companies as the year progresses.
No prior knowledge of investing is required to join Knight Capital, as the club’s goal is to educate students. “I know it can sometimes be an intimidating topic, but that’s all the more reason to want to be in a group like Knight Capital. Our goal is to educate students and make them more excited about investing,” Mr. Merlin said.
“If you are interested in stocks, great,” said Jonathan. “But if you like doing good for others and helping out the Pace community, that’s another reason to join.” Any student who is interested in joining Knight Capital should contact Jonathan Merlin (404-680-0188) or Mr. Kaufman (firstname.lastname@example.org).
Photo: Junior Jonathan Merlin leads a discussion during a Knight Capital meeting regarding healthcare stocks. Photo: Gabriel Kadoori