Investing: Building A Mock Portfolio

Updated July 16, 2023

Building a mock investment portfolio combines two of kids’ most favorite things, competition and a side of screen time 😉. Creating a mock investment portfolio allows kids to participate in the investing game, with no real risk and a mountain of reward.

A mock investment portfolio is a selection of stocks, ETFs, mutual funds and more that a mini investor tracks and allocates to using pretend money. By taking an extended test run in the markets, kids can get acquainted with market research, financial websites and investing all without having any real skin in the game.

The best part? It’s easy... and risk free!

Simple steps to build a mock investment portfolio:

1. Set Clear Goals 

Before diving into these mock investments, take some time to talk about investment goals and objectives. This will be good practice for when it comes time to invest with actual money! Determine your investment time horizon, risk tolerance, and desired outcomes.

While adults might consider investing for retirement, a down payment on a house, or simply to grow their wealth, investment goals might be something more near-term and tangible for kids such as increasing their funds to buy a special toy or maybe saving up for a car down payment.  Having a clear sense of purpose will guide investment decisions.

2. Get familiar with the basics

Take a little time to research and learn about different investment types, such as stocks, bonds, mutual funds, and exchange-traded funds (ETFs). Kids can also familiarize themselves with key investment concepts including diversification, risk, and return.

3. Pick Investments

Kids can pick their own stocks, ETFs or mutual funds to get started. By selecting three to five of their favorite companies (Roblox, Nike, Disney) or favorite sectors (aerospace, robotics, AI), kids will be inherently invested in watching the action play out in the market.

4. Create a Yahoo Finance Account

Kids can create a Yahoo Finance account and assemble a watchlist of their picks to track performance. Alternatively, you can create a simple spreadsheet using Microsoft Excel or Google Sheets. Whichever option you choose, ensure it provides the necessary tools to input and monitor your mock investments effectively.

5. Allocate Assets

Allocate your mock portfolio investments across different asset classes to spread out risk. Consider investing in a mix of stocks, bonds, and other investment vehicles. Research and select specific investments within each asset class based on your risk profile and goals.

6. Monitor and Adjust Their Mock Portfolio

At the end of each fiscal quarter, kids should take stock of their mock portfolio and make any necessary adjustments. Discuss the factors that could be influencing stock prices and encourage your kids to share their thoughts on potential strategies or changes to their portfolio.

Quarterly conversations can yield a huge payoff. Have earnings been reported? What is the best performer? Would you stay invested if you actually owned? What would you have done differently?

7. Stay Informed

Encourage your child to follow financial news, market trends, and company updates related to their mock stocks. This will enhance their understanding of the factors that might impact stock performance and promote informed changes to their mock investment portfolio when needed. 

Continual learning will help your kiddos refine their investment knowledge and improve their decision-making abilities when it comes to money and investments.

For a job well done, parents may even choose to buy a share or two of their children’s top picks to make a mock investment portfolio come to life. And while the financial gains may be real, there’s no doubt that the biggest payoff is simply in playing the game.

Confused by some of the market lingo? Here are some stock market terms to get you and your little prepped to invest.

What three to five companies would you be interested in investing in? Why?