Investing
"...the Investing standards focus on funds set aside for future long-term goals, invested in riskier financial assets with the expectation of increasing future wealth or income."
Grade 4
Investing 4-1
People invest their money so that it can grow over time and help them achieve their long-term financial goals.
4-1a. Explain why people invest their money.
4-1b. Identify long-term financial goals that are most likely to be achieved by people who regularly invest their money over many years.
Investing 4-2
Low-interest savings accounts are commonly used for short-term financial goals and emergency funds because they are low risk. When saving for longer-term financial goals, people often invest in riskier assets to earn higher returns.
4-2a. Identify the similarities and differences between saving and investing.
4-2b. Provide examples of financial goals that are suited for saving versus investing.
Grade 8
Investing 8-1
Investors in financial assets expect an increase in value over time (capital gain) and/ or receipt of regular income, such as interest or dividends.
8-1a. List the potential benefits of investing money in a financial asset.
8-1b. Explain why some people might prefer to buy investments that grow in value over time instead of investments that pay regular income.
Investing 8-2
Common types of financial assets include certificates of deposit (CDs), stocks, bonds, mutual funds, and real estate.
8-2a. Define common types of financial assets.
8-2b. Demonstrate how to find the current prices of stocks, bonds, and mutual funds.
8-2c. Discuss how some financial assets can be harder to sell quickly (e.g. stocks traded on an exchange versus real estate).
Investing 8-3
Investors who buy corporate or government bonds are lending money to the issuer in exchange for regular interest payments.
8-3a. Compare corporate and government bonds.
8-3b. Calculate the amount of annual interest income an investor would receive from a corporate bond offering at a given coupon interest rate.
Investing 8-4
Investors who buy corporate stock become part-owners of a business, benefit from potential increases in the value of their shares, and may receive dividend income.
8-4a. Select a stock and find the dividends it paid last year and how much the price of the stock has changed over the year.
8-4b. Explain the potential risks and rewards of investing in corporate stock.
Investing 8-5
Instead of buying individual stocks and bonds, investors can buy shares of pooled investments such as mutual funds and exchange-traded funds (ETFs).
8-5a. Explain the concept of investment diversification both within and among different asset classes.
8-5b. Discuss the advantages and disadvantages of investing in a diversified stock or bond mutual fund versus individual stocks and bonds.
Investing 8-6
Different types of investments expose investors to different degrees of risk.
8-6a. Compare rates of return on different types of investments and order them by risk.
8-6b. Identify investments that would be most appropriate for people who are uncomfortable with taking financial risk.
Investing 8-7
Compound interest is interest on both the original principal and previously earned interest, as compared to simple interest which is only interest on the original principal.
8-7a. Explain the concept of compounding.
8-7b. Estimate the future value of a lump sum invested today for a specified period of time and rate of return.
8-7c. Estimate the future value of a regular series of equal annual investments for a specified period of time and rate of return.
8-7d. Demonstrate the difference in wealth accumulation for a person who begins to invest regularly at age 30 versus someone who starts at age 40.
Grade 12 (Coming in the future)
Investing 12-x