Taming Wall Street’s golden bull
MIKE McGEE | 8/4/2017, 6:21 p.m.
The Dallas Examiner
African Americans lead nationwide poverty rates, just slightly edging out Native Americans, per the United States Department of Agriculture. Even when educated and employed, 27 percent of African Americans continue to live below the poverty rate, according to the U.S. Census Bureau. Building wealth in the Black community has been an ongoing struggle for many years.
While investing in the stock market could be part of the solution, African Americans save and invest at a much lower rate than Whites, according to a national study conducted by Chicago-based Ariel Investments. The study showed Blacks were more leery of the stock market.
“I believe the more you know, the more you can grow,” stated Linda Gray, president and CEO of the Greater Southwest Black Chamber of Commerce, as she considered the purpose of the program Taming the Gold Bull Part 1: Learn How To Invest In The Stock Market. The event was held at the GO Federal Credit Union in Lancaster on July 19.
Kevin E. Davis, CFP, gave a lunchtime lecture entitled How To Invest In The Stock Market during the workshop. The event, hosted by the Greater Southwest Black Chamber of Commerce Young Professionals, was intended to demystify the process of buying and selling stock, an endeavor that is sometimes half-jokingly called “legalized gambling.”
A careful scrolling through the Forbes tally of the world’s 2,043 billionaires reveals that Oprah Winfrey, Michael Jordan and Austin investor Robert Smith are the only Black Americans on the list of an otherwise globally diverse high-roller club.
While not everyone can be a billionaire, the stock market workshop assisted those interested in better preparing for their financial future. Davis voiced some of the considerations potential investors had to ask themselves, including what type of industry they would invest in – such as health or technology – what their financial objectives would be and the number of shares to invest in.
“You can buy 10 shares, you can buy five shares. And now, because of technology, those orders get placed. Probably, if you had to do that 15, 20 years ago, you probably wanted to do it at 100-share lots,” he explained. “Technology now is so efficient, you can buy five shares, 10 shares, whatever the case may be.”
Some of the financial planner’s talking points included deciding what trading company to use. That meant the buyer would have to do some research into companies to learn their policies, histories and the pros and cons of going with one brokerage over another.
Concepts that were introduced, such as the price to earning ratio (also called the P/E, dividing the price of the stock by the predicted earnings per share) and purchase orders or sell orders (shares sold at current market price vs. shares sold at a stockholder’s specified price), were discussed in detail, and Davis always took the time to answer any questions from the small audience.
The attendees, all African American women, inadvertently represented a subset of peoples historically underserved in the U.S.