Introduction to Investing in the Stock Market - Part 1

How to boost your bottom line, make your money work overtime, and become a financial goddess

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I know Beyonce told us that girls run the world but you know she and Jay-Z understand better than most that you need money for true power. A lot of us just have our meager savings sitting in our bank account not doing much. The most you usually get from putting your moolah in a savings account is a piddling 5 percent. You can expect an average rate of return of 12 percent from some medium risk investments in the stock market. To explain what we are doing by investing in stocks, I’d like to tell you about a friend of mine who now runs a successful restaurant selling southern cuisine.

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My friend (we’ll call her, Debra) had always really wanted to start a restaurant, but she was a struggling single mother and there was no way that she was going to be able to put together enough green to start a business like that. She didn’t have a ton of money but she did have lots of good friends and close family who supported her dreams. Okay, we all love Debra, but, even more important to this story, we love her double-baked mac and cheese, southern greens, candied yams, peach cobbler, cornbread, and barbecue. We’d all enjoyed her food many times and knew that anyone else who tried her food would also want to have it again and again. So, we were all willing to pitch in to contribute to her business. This wasn’t charity. It was an investment. By contributing to its startup, we all became part owners in her business. Which is really nice now that she’s starting to make a profit because it means that we each get some fraction of those profits, depending on how much we contributed. (Some of us just get free barbecue when we visit the restaurant).

Investing in a company works in a very similar way. Companies, like Debra, raise money by trading ownership in their company for funds. When you purchase a share of stock in that company, you become part owner. For example, take a look at the Walt Disney Company.  You could buy one share of stock in Disney, at the time I am writing this, for $110.55 (U.S. dollars). Don’t get too excited though. There are 1.51 billion shares of Disney floating around. So, your one share of stock would be a 1/1.51 billionth stake in the company.  

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Just in case you wanted to get them to produce the animated version of that fanfiction you just wrote, note that a fraction of ownership in Disney that small won’t really give you any say in what happens at Disney. In fact, brokers (that’s who you buy shares of stock from) won’t usually let you purchase shares of stock in less than 100 share “lots.” It’s kind of like how the ATM won’t let you take less than $20 out, except you are spending money with the brokers and it’s just not worth it to them to put the transaction through unless it’s a full lot of 100 shares. Let’s see then. Hmmmmm, 100 shares of Disney at $110.55/share… that’s $11,055 for one lot. Yikes! Don’t worry, there are other ways to get into investing though, that don’t involve spending the down payment for a house.  

One way is to buy shares of companies that are not quite so expensive. There are lots of companies whose stocks are trading for less than $100. For example, let’s look at a few companies in the video game industry. Are you a fan of Call of Duty or Overwatch?  

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Activision shares are currently selling for $70.98 each. What about mobile gaming? Does it seem like there is always someone playing Farmville on their phone? Mobile game maker, Zynga, is currently a very affordable 3.75/share. And, Gamestop, the video game retailer, is not too expensive at $16.69/share.

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Why would you want to have a stake, or part ownership, in a company anyway though, especially if it was going to be such a small fraction? Well, the price of a stock goes up or down depending on how well people believe the company is going to perform in the future. So, if everyone was excited about the next Thor movie coming out and expected this to boost Disney’s profits because it was expected to do very well at the box office, then the price of Disney stock might go up before the movie comes out.  If you bought it today at $110.55/share and then shortly before the latest Thor movie comes out it goes up to $125.00/share and you sell at that price (buy low, sell high), then you would have made $15/share. Not that exciting if you only have one share of Disney maybe but let’s say you bought three lots of Zynga (that’s 300 shares) March of last year at $2.75/share?

Zynga Stock Chart.

Zynga Stock Chart.

If you sold your lots at $3.75/share, then you would have made $1/share or $300 total. That’s in just 10 months! That’s an amazing rate of return given that you made $300 from investing only $825 initially.

The down side is at least as big as the upside though as you can also lose money in the same fashion. In November, Zynga was selling for $4.17/share. If you had purchased your three lots of stock at that time then you would be down $126 on your initial investment, about 10 percent. It’s important therefore to know something about the company you are investing in. If you like video games, invest in game companies that make the titles that you’re excited about or who run the stores where you are currently buying your games. Do some research to find out information about what is coming out in the future and invest in the companies that make the titles you are looking forward to purchasing later. If you are buying from them, after all, you are already investing in them financially, without the benefit of being part owner. Make a switch from consumer to intentional investor and watch your financial potential bloom.

 

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Stay tuned until next time when I’ll talk about mutual funds, a relatively low-risk way to start investing and a method of purchasing expensive stocks in companies like Disney or Apple without selling everything you own.

 

The Science of Black Panther: Is Vibranium Real?

With everyone eagerly anticipating Black Panther's Feb. 16, 2018, release, we wonder, is vibranium real?

To say that folks are excited about the Black Panther movie coming out this February would be a gross understatement. It was little surprise when the number of advance tickets sold in a day exceeded any previous Marvel movie. Even Lupita Nyong’o had trouble getting a ticket to see the movie on opening night (well, the latter is a bit surprising... they didn’t give homegirl enough complimentary tickets?). And why shouldn’t we be excited about a genius martial artist with all the super abilities that you would expect of a hero named after a large wildcat (e.g night vision, smell, speed, agility, and strength)? He rules the nation where Vibranium comes from (Captain America’s shield is made of a Vibranium-steel mix or alloy), wears his own Vibranium suit, and gets many of his powers from ingesting an herb that was exposed (like much of Wakanda’s plant and animal life) to Vibranium radiation.  

Since Vibranium is so central to Black Panther’s powers, you might have wondered if there were any such material in the real world. Vibranium’s key feature is that it absorbs energy, for example from sound waves, vibrations, and the kinetic energy from impacts, and it uses this energy to become stronger. Are there other materials like this?

Unlike Vibranium, most materials become weaker the harder you hit them. Mangalloy, a type of steel alloy made with 11-14 percent manganese, is an exception. Under impact, its surface becomes nearly three times as hard while its interior stays at its original unbreakable strength. It is also highly abrasion resistant, meaning that it is not easily worn down or corroded and, in fact, it takes on a brilliant polish when rubbed or scratched. Unlike Vibranium, it is also non-magnetic so it might be a smart choice in a battle with Magneto. But you would have a difficult time making armor or even a shield from Mangalloy for some of the same reasons that make it such an amazing material. It’s almost impossible to work with because you can’t soften it by heating it (annealing) and if you try to use a machine to grind it or cut it, it gets harder. Superman could do some damage though, since, although not easy to do, it’s possible to grind it down with diamonds.

Source: West York Steel

Source: West York Steel

We might be getting closer to creating a Vibranium-like armor though, as scientists have recently discovered a nanomaterial, two-layer graphene that becomes as hard and stiff as diamonds upon impact. Graphene is a super-thin film, the thickness of a single atom, of bonded carbon atoms. It is constantly amazing scientists with its material properties and its unique physical characteristics have led scientists to use it frequently as an additive or nanofiller to enhance the properties of polymers. It turns out that when you compress two-layer graphene (exactly two), even with a diamond indenter, it takes on a diamond-like structure with the same rigidity and toughness.   

Source: Wikipedia, Graphene

Source: Wikipedia, Graphene

Speaking of polymers, new plastics are being developed. These plastics, called mechanophores, “heal” stronger than they started when they are subjected to stress. One particular synthetic polymer developed by a team of scientists at Duke University becomes stronger when it experiences a shear force or a tearing due to a mechanical force because this exposes places in the plastic for new bonds to form with the carboxylate molecules included in the material. But Plastic Man is in the DC universe so…

The creation of materials that can rival Vibranium is very much still in progress, but there have been many interesting developments in recent years. The people that research these materials are called, unsurprisingly, material scientists, and they have expertise in a variety of disciplines including chemistry and physics.

Real Life Superheros and Material Scientists:

Professor Jenny Nelson

Professor Jenny Nelson

“Jenny Nelson is a physicist whose research is devoted to characterising the materials used to build and improve photovoltaic devices, which convert energy from the Sun into electricity. She applies a range of tools that include physical models, simulation and experiments to optimise the performance of such devices through their composite materials…

Since 2010, Jenny has also been studying the potential of photovoltaic technologies to reduce the amount of carbon dioxide that is emitted during the generation of electricity, lessening the impact on climate change. She is the author of a popular text book, The Physics of Solar Cells (2003).”

Text excerpted from The Royal Society .

Martha Sanchez

Martha Sanchez

Martha Sanchez is a material scientist and, according to Forbes, one of the first Latina researchers at IBM’s San Jose Almaden lab. She is very involved in outreach, working with kids in inner city schools to share her love of science and technology.

She wrote on her blog at IBM, “When I tell people I work in lithography, the first image that often comes to mind is a process for reproducing fine art. In addition to producing art that’s suitable for framing, lithography is the key method in making computer chips, which is my area of expertise. We use predominantly photolithography to produce fine lines made of polymers using light to create the connections between transistors on chips that help process data.

By researching new ways to print connective lines out of polymers, we can improve the speed and computing performance of chips for today’s computers. Our goal is to create increasingly smaller lines that allow us to create greater connection density, essentially letting chips process more information faster while taking up less space.”

5 Inspiring Female Scientists and How You Can DIY STEM

There have been many exciting developments in the fields of science, technology, engineering, and mathematics. As I started this article, I wanted to tell you about a few of the many amazing women doing groundbreaking work in STEM. However, as everyone who knows me has long since realized, the one thing I love more than telling an entertaining story about science is showing how the science works and letting people get their hands dirty experimenting for themselves.

So, I would like to introduce you to five inspiring women in STEM today and also suggest how you might experience a taste of the work they have pioneered. Some of these projects you can do at home for little or no money, while others require some investment. Either way, these experiments are exciting and I hope you find these scientists as inspiring as I do. I hope you get a taste for their passionate work as well as a reminder that science is for everyone, including you.

Happy New Year!

 

1. Dr. Fabiola Gianotti

By ATLAS Experiment © 2011 CERN

By ATLAS Experiment © 2011 CERN

 

Dr. Fabiola Gianotti became the first female director-general of CERN (the European Organization for Nuclear Research) in 2016.  The Italian physicist led the Large Hadron Collider (LHC) experiment, ATLAS, when ATLAS and the Compact Muon Solenoid (CMS) made the Nobel-Prize winning discovery of the Higgs boson.

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2. Dr. Nina Tandon

By SiliconANGLE

By SiliconANGLE

 

Dr. Nina Tandon is a biomedical engineer and the CEO of EpiBone, a company working on growing bone transplants from a patient’s own stem cells on a 3D printed scaffold.

You can learn how to create your own 3D printed scaffolds for cell cultures from artist Amy Karle who has photos of her incredible work online.

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3D Printed Scaffold


 

3. Dr. Maryam Mirzakhani

Mirzhakani photo from Stanford University

Mirzhakani photo from Stanford University

 

The world suffered an enormous loss when Iranian mathematician Dr. Maryam Mirzakhani passed away in July 2017. In 2014, Mirzakhani became the first woman to win the Fields Medal, the most prestigious prize for mathematical achievement, analogous to a Nobel Prize for mathematics (of which there is none). Much of her research was on hyperbolic surfaces and Mirzakhani was awarded the Fields Medal for her “outstanding contributions to the dynamics and geometry of Riemann surfaces and their moduli spaces.”

You can build models of hyperbolic geometric structures at home, hopefully gaining along the way some small bit of the enormous enthusiasm Mirzakhani had for mathematics in general and, more specifically, for Hyberbolic Geometry. She is quoted as saying that the more she spent time on mathematics, the more excited she got about it.

DIY


 

4. Dr. Jeanette Epps

NASA

NASA

 

In May 2018, Dr. Jeanette Epps will be the first African-American to live on the International Space Station for an extended period of time. Epps was a NASA fellow while earning her Ph.D. in mechanical engineering at the University of Maryland, did research with Ford Motor Company, and worked as a Technical Information Officer for the CIA for over 7 years, and completed a nine-day underwater NASA research mission with NEEMO.

DIY

Orbital Space Flight Simulator


 

5. Dr. Jennifer Doudna

Photo by Duncan Hull

Photo by Duncan Hull

 

Dr. Jennifer Doudna, a biochemist at UCBerkeley, is one of the primary developers of Crispr-Cas9, a revolutionary technique for genome editing. Crispr is now widely employed because doing so is so much easier, less costly, and more precise than previous techniques for genomic engineering. Crispr could potentially be used to eradicate infectious diseases and more controversially could also be used for eugenics or the development of biological weapons. Since part of its benefit is its ease of use, it can not only be used by labs everywhere but also by you at home with one of the DIY Crispr kits now available for sale.