In the wake of the Moody’s downgrade, the COVID-19 outbreak and the seemingly endless economic woes of the country, financial education has never before been more important. This intensifies the value of the JSE Investment Challenge, a 47- year-old annual initiative that the bourse developed to enable school learners and higher-education institution students to understand the fundamentals of investing on the stock exchange.

At its essence, the challenge (which runs from March to September) provides teams of four with a virtual sum of R1 million to invest over six months in actual JSE-listed shares. The winning school team is awarded R21 000 in an investment account and, for the top university team, the prize is a trip to an international stock exchange, plus R25 000. Monthly incentives are also granted.

Over the past decade, the challenge has morphed into the virtual-reality zone, which taps into Generation Z’s ease of using technology. Idris Seedat – Head of Transformation and CSI Marketing and Corporate Affairs at the JSE, and one of the custodians of the Investment Challenge – explains that Gen Z are as comfortable in the digital space as they are with navigating the offline world.

‘This duality bodes well for their cognitive learning,’ he says. ‘Their acquisition of information is almost seamless – be that from the internet or social networks – and taps into their innate curiosity. I endorse the term coined by McKinsey and Company that Gen Z are “true digital natives”, which is a good foundation for those participating in the JSE Investment Challenge.’

In the wake of the coronavirus and consequent lockdown, the 2020 participants may find themselves digging even deeper into their collective digital talent pool by needing to meet in chatrooms or using online video. Mentors make themselves available through similar platforms, and the JSE Investment Challenge team is also online, and on email, to respond to any queries.

Where access to the internet or airtime is limited, teams and mentors are encouraged to be creative, according to Seedat. ‘This may require some strategic workarounds, such as appointing one team member to determine how much time is required online, and thereafter [perhaps] sharing the cost among the team’s peers,’ he says.

‘The lockdown is a true test of the financial literacy that is made available through the challenge,’ says Seedat. ‘Teams must understand that despite the state of affairs, trading still continues. It will test their ability to thrive especially given the volatility of the markets currently, but this in itself creates great opportunities to be resourceful and more strategic.’

Last year the challenge attracted more than 23 000 participants, predominantly from rural areas, arguably where financial skills are most required. ‘The learnings from participating in the challenge not only equip these individuals with life-long lessons that can be applied to build a strong financial future right from their first pay cheque but also benefit communities in the sharing of knowledge,’ says Seedat.

That knowledge extends to the value of savings and how investing in the long term can promote financial freedom, which is much needed in a country that has a low savings rate and little long-term retirement planning. And even more so during the coronavirus pandemic, which will result in incomes being threatened, jobs lost and savings being tapped into. This supports one of the objectives of the JSE Investment Challenge, which is to build financially literate communities and individuals.

‘We strongly encourage schools, teachers and students to register and participate in the 2020 Investment Challenge,’ says Seedat. ‘There is no better way to become financially literate than through this fun and interactive platform.’

By Kerry Dimmer
Image: Gallo/Getty Images