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What Is A Stock?

ngpf.org Last Updated: 01/09/26

High School Personal Finance: Semester Course

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Learning Objectives

Students will be able to…

Explain what stocks are and how they can make money from investing in them

Identify ways to minimize risk when investing in stocks

Read a stock quote and evaluate a stock’s performance over time

Understand what a stock split is and how it impacts investors who own that stock

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Intro

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If you invested $1,000 in Netflix stock ten years ago, what would it be worth now?

Q:

INVESTING

QUESTION OF THE DAY

ngpf.org 1/26/26

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INVESTING

$8,634.45�(January 2026)�

A:

QUESTION OF THE DAY

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FOLLOW-UP QUESTIONS

  1. How would you describe the trend in Netflix stock prices over time?
  2. What factors might have caused significant changes to Netflix’s stock price?
  3. Do you think as an investor it would have been easy to buy Netflix stock 10 years ago and hold it over this time period? Explain your answer.
  4. Who do you think are Netflix’s competitors today?

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Learn It

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Understanding Stock Market Investing

If you want to grow your wealth, investing in stocks is a great option. Watch this video to learn more about what stocks are, how they work, and what you can do to minimize your risk when investing in stocks.

Video: Investing Basics: Stocks

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Stock Market Investing: Share Values

Company A is raising $1 million at its initial public offering (IPO) by issuing 2,000 shares of stock. What is the value of each share?

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Sentence Starter: To calculate the value of each share at Company A's IPO, I would divide...

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Stock Market Investing: How to Make Money from Stock Ownership?

Julia buys a share of stock through her brokerage firm. What are the two ways that Julia could make money from owning this stock?

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Sentence Starter: Julia could make money from owning a share of stock by…

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Stock Market Investing: Minimizing Risk

Julia knows that investing in just one company is risky since there’s a chance that the stock’s value could decrease. What are some ways she can minimize her risk?

Sentence Starter: To minimize the risk of investing in a single company, Julia could...

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Decoding the Stock Market: Understanding Stock Quotes and Performance

To understand if a particular stock is a good investment option for you, you’ll need to know how to read a stock quote so you can evaluate its performance.

Read through this article to learn how to read a stock quote. Then, review the stock quote.

Article: How to Read a Stock Quote

Reference: Stock Performance - Nike

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Understanding Stock Quotes and Performance

According to the article, why is it more useful to look at the percent change of a stock price, rather than the change in dollar amount?

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Sentence Starter: Looking at the percent change of a stock price is more useful than the dollar amount change because...

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Comprehending Stock Quotes and Performance

Look at the stock performance for Nike. Describe the trend in Nike stock prices over the last year. What about the last 5 years?

Sentence Starter: The trend in Nike stock prices over the last year has been...

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Decoding the Stock Market: Small, Medium, and Large Cap Companies

Is Nike a small, medium, or large cap company? How do you know?

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Sentence Starter: Nike is considered a...

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Decoding the Stock Market: Stock Quotes and Performance

Company B’s stock price is $500. You overhear a classmate say, “Based on the stock price, Company B’s value is clearly higher than Nike’s!” Why might your classmate be wrong?

Sentence Starter: My classmate may be wrong about Company B's value…

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Understanding Stock Quotes and Performance: A Stock’s Price History

If you were considering buying a stock, which time frame would you use to analyze its price history (1-day, 5-day, 1-month, etc)? Why?

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Sentence Starter: When analyzing a stock's price history, I would use the...

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FinCap Friday: Stock Split Summer

Sometimes, a company will announce a stock split. So, what does this mean for you as an investor?

Go through this FinCap Friday to find out! As your teacher progresses through the slides, answer these questions, just writing A, B, C, or D for questions 1 - 5.

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Stock Split Summer

Investing

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  1. Which of the following is a good analogy for a stock split?

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  1. Getting a pay bonus at your job
  2. Buying something on sale
  3. Paying a premium for something you want
  4. Exchanging large currency bills for smaller bills

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STOCK SPLIT SUMMER | JUNE 14, 2024 EDITION | NEXT GEN PERSONAL FINANCE

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  • Which of the following is a good analogy for a stock split?

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  • Getting a pay bonus at your job
  • Buying something on sale
  • Paying a premium for something you want
  • Exchanging large currency bills for smaller bills

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STOCK SPLIT SUMMER | JUNE 14, 2024 EDITION | NEXT GEN PERSONAL FINANCE

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2. True or False? A stock split changes the overall value of a company.

  1. True
  2. False

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STOCK SPLIT SUMMER | JUNE 14, 2024 EDITION | NEXT GEN PERSONAL FINANCE

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2. True or False? A stock split changes the overall value of a company.

  • True
  • False

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STOCK SPLIT SUMMER | JUNE 14, 2024 EDITION | NEXT GEN PERSONAL FINANCE

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3. Which company below had a stock split in early June 2024?

  1. Tesla
  2. Alphabet
  3. Nintendo
  4. Nvidia

STOCK SPLIT SUMMER | JUNE 14, 2024 EDITION | NEXT GEN PERSONAL FINANCE

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3. Which company below had a stock split in early June 2024?

  • Tesla
  • Alphabet
  • Nintendo
  • Nvidia

STOCK SPLIT SUMMER | JUNE 14, 2024 EDITION | NEXT GEN PERSONAL FINANCE

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4. Which statement below is generally true about a company that announced a stock split:

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  1. The company is doing very poorly
  2. The company only offers short term profits
  3. The company is in good health
  4. The company is not under good leadership

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STOCK SPLIT SUMMER | JUNE 14, 2024 EDITION | NEXT GEN PERSONAL FINANCE

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4. Which statement below is generally true about a company that announced a stock split:

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  • The company is doing very poorly
  • The company only offers short term profits
  • The company is in good health
  • The company is not under good leadership

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STOCK SPLIT SUMMER | JUNE 14, 2024 EDITION | NEXT GEN PERSONAL FINANCE

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5. When it comes to stock splits, experts advise young investors to:

  1. stop paying too much money for stocks after they split
  2. ignore the stock split hype and focus on fundamentals
  3. beware of marketing scam around stock splits
  4. obsess over every piece of news about stock splits

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STOCK SPLIT SUMMER | JUNE 14, 2024 EDITION | NEXT GEN PERSONAL FINANCE

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5. When it comes to stock splits, experts advise young investors to:

  • stop paying too much money for stocks after they split
  • ignore the stock split hype and focus on fundamentals
  • beware of marketing scam around stock splits
  • obsess over every piece of news about stock splits

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STOCK SPLIT SUMMER | JUNE 14, 2024 EDITION | NEXT GEN PERSONAL FINANCE

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You’ve completed the exercise, now it’s time to learn

more about the current event:

STOCK SPLIT SUMMER | JUNE 14, 2024 EDITION | NEXT GEN PERSONAL FINANCE

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Discussion Prompt:

Would you consider investing in a company that announced a stock split? Explain why.

STOCK SPLIT SUMMER | JUNE 14, 2024 EDITION | NEXT GEN PERSONAL FINANCE

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FinCap Friday: Stock Split Summer

You’ve been interested in investing in Company C for quite some time. You’ve done your research and you’re ready to invest. Coincidentally, Company C just announced a stock split. Why might this be good news for you?

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Do It

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Activity: 5 Stocks on Your Birthday

You’ve learned a lot about what stocks are and how to evaluate their performance. Now, let’s put it all together.

Follow the directions on the worksheet to complete this activity.

Activity: PROJECT: 5 Stocks on Your Birthday

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Exit Ticket

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Exit Ticket 1: What is a Stock?

What is a stock?

  1. A measurement of a company’s profits
  2. An investment option that allows you to own a small piece of a company
  3. An annual report that includes details about a company’s leadership and earnings
  4. A low-risk savings option that can help you build an emergency fund

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Exit Ticket 2: Stock Quotes

When reading a stock quote, which of the following metrics would give you the best idea of the total value of the company?

  1. The stock ticker symbol
  2. The price change of the stock, quoted as a percentage
  3. The market cap
  4. The stock’s opening and closing price for that day

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Exit Ticket 3: Stock Splits

Which of the following is TRUE about a stock split?

  1. Stock splits impact the overall value of a company
  2. Stock splits decrease the number of shares you own
  3. Stock splits indicate that a company is doing poorly
  4. Stock splits make a stock more accessible to a greater number of investors