CONTRIBUTORS

Cindy Perman
News Editor at CNBC.com and the author of The Pony Blog (ponyblog.cnbc.com). She has also written a book, “New York Curiosities,” and does stand-up comedy.
Jane Wells
CNBC business news reporter, based in Los Angeles, covering the defense and technology industries. She writes the CNBC.com blog Funny Business.

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The news can get a little heavy sometimes, with debt crises, vicious markets and crappy earnings reports. So, we dispatched our crack reporters, Cindy Perman and Jane Wells, to find some levity amid all this seriousness. May we offer you a Keynesian cocktail with a side of bacon?

Why a Pony? To be clear, there were no ponies harmed in the making of this blog. The blog’s name, “There Must Be a Pony In Here Somewhere,” comes from an old joke, a favorite of Ronald Reagan’s, that essentially means, with a pile of you-know-what this big, there MUST be a pony—a bright side—in here somewhere!

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May.29

2:49 PM ET

Friday, 29 May 2009

Want to Make Money on Stocks? Ask a Fifth Grader!

Posted By:Cindy Perman

Sectors:Financial Services

Are you smarter than a fifth grader?

Child with money
I love the smell of money in the morning.

If you’re talking about the stock market, probably not.

A team of fifth graders at the Tullar Elementary School in Neenah, Wisconsin, won the state-wide Wisconsin Stock Market Game, beating out all the other students — including high-schoolers!

The winning team, led by teacher Tim Hopfensperger, took $100,000 of hypothetical money and doubled it, ending the 10-week contest with $203,000 in their portfolio.

“It felt amazing,” one of the students, Bailey Morton, told the AP. “It was like a sugar rush!”

Another said she was so excited, she wanted to scream.

Typical fifth graders.

Well, except for the fact that they were able to manage their portfolio — in the middle of one of the worst recessions in history — better than most of Wall Street!

How did they do it? Well, they don’t want to give away their trade secrets, but you might be interested to know their entire portfolio was financials. Of the 15 financials they invested in, 13 were profitable trades.

"My approach to the game was always — they can do whatever they want and I'm going to kind of be their broker," Mr. Hopfensperger said.

"What we did was just take a risk with the financials — it was beat up at the time," Jen Sagehorn, an 11-year-old on the team explained to me via cellphone while she was waiting in line to see the Statue of Liberty, part of her grand-prize trip to New York. "And we decided to take a risk and see if it would make money — which we did," she explained.

Impressive. I know a lot of adults who were too big a scaredy cats to get involved with financials!

When I asked both girls, Jen and Bailey, what they learned, both matter-of-factly explained to me what a short sale was.

"You just gotta watch the market and watch how it's going," Bailey explained. "When it goes up, you take a risk and buy shorts instead of long."

After a tour of the New York Stock Exchange today, Jen said she thinks she might want to be a trader.

"It felt like now I kind of want to do what they're doing," she said of the traders on the floor. "It looked like so much fun to do."

So, to all you losing money out there: Give it about 10, 15 years and she can help turn your portfolio around!

Wisconsin has been running the statewide contest, part of a nationwide contest, for more than 20 years.

They train teachers about the stock market, using a guide called “Learning, Earning and Investing” from the National Council on Economic Education. Then, it’s the teacher’s job to teach the kids and get them started investing.

OK, now, point to the one you think is going to go higher. C'mon, sweetheart. You can do it! Tell momma.

Mr. Hopfensperger is no stranger to stock-market success: He led the team that took the first-place title in 2007, and has repeatedly wound up in the top three.

“The game introduces kids to the stock market and takes the fear out of it,” said Melissa Guzman, the program coordinator at Economics Wisconsin who organized the stock game. It helps boost their confidence and, when they eventually get out in the work force, they’re less intimidated by their 401(k), she said.

“I think a lot of adults are afraid of the stock market, too!” Ms. Guzman quipped.

Parents learn a thing or two from their kids in the process, she said, recalling a story from one mom at a past awards ceremony.

“The daughter was downstairs in the basement on a Saturday morning,” Ms. Guzman explained. “The mom called down to her to see what she was doing and the girl replied, ‘I’m checking my stocks, mom, hold on!’”

So, for those of you parents who monitor your kids' online wanderings and read their diaries, maybe you should check to see if they have any good stock picks in there!

The Winning Portfolio:
Of course, they can't tell you all their secrets, but in this contest, which ran from February through April, they decided financials were the way to go. Here are some of their winning picks:

Deutsche Bank (Their biggest winner) [DB Loading... () ]