NCAA March Madness soon approaches, ushering in a time when sports fans gather to watch the best of the best in college basketball. It’s also a time when office productivity is expected to take a decline due to game watching and bracket betting pools. According to outplacement firm Challenger, Gray & Christmas, Inc., online coverage could attract more than 2.5 million unique visitors per day, “with each [employee] spending an average of 90 minutes watching games. With private-sector workers earning an average of $23.29 per hour … employers will end up paying distracted workers about $175 million over the first two full days of the tournament.â€
One professional seeks to turn this popular craze into productive (and lucrative) lessons on investing, promoting financial literacy among those who love sports and brackets. Robert Wilson, vice president at Blazer Capital Management L.L.C, has created March Money Madness, an investing-focused game that allows players to put stocks head to head.
BlackEnterprise.com caught up with Wilson on how he linked a love of sports with advocating financial literacy, how his celebrity sports clientele inspired his idea and how youth can learn more about investing in creative ways.
BlackEnterprise.com: What inspired you to create the March Money Madness?
Robert Wilson: In my financial advisory practice, I work with professional athletes and entertainers. I also speak to kids a lot about financial topics, but I found that all they wanted to talk about were my celebrity clients. Instead of pushing back on that, I decided to fight fire with fire by trying to find a way to leverage their interest in sports and entertainment to teach them about important financial topics.
That’s how March Money Madness was born. I developed the game in an effort to leverage the popularity of the NCAA basketball tournament and brackets that so many people fill out before the tournament. It’s estimated that 40 million people fill out at least one bracket for March Madness, so I felt as though there was a huge interest that I could play off of.
How exactly does March Money Madness work?
Players sign up for the bracket challenge and pay a $5 entry fee. The top prize this year is 50% of the entry fees, so the more people play, the more the winner can take home. I have an ambitious goal to educate 100,000 people this year. If 100,000 people join the challenge, someone can walk away with $250,000 to pay off debt, go to school or start the business of their dreams.
After each round, the players receive an e-mail and video recap of the market action from the week including an analysis on why each particular stock won (or lost) its match-up and the factors that led to the outcome.
Today, the list and pairings of the 64 stocks included in the challenge will be announced, and players can begin making their picks.
Players must make their picks for the first round by 9:30 a.m. (the time the stock market opens) on March 12.
The challenge works in a round-by-round format. This means players make their picks for each round, rather than picking the winners for the entire tournament up front. This allows players who didn’t have many correct picks the first round, for example, to still be engaged in the competition since their entire bracket will not be ruined by a bad first round. Because points increase for each round, anyone can win.
To further explain this: Let’s say two first-round match ups were Apple vs. Microsoft and Google vs. Yahoo, and the winners of these two match-ups will play in the second round. You picked Microsoft and Yahoo to win their first round games, however, Apple and Google were the actual
winners. You would get no points for your incorrect picks for those first round games, but because the game is in a round-by-round format, you can pick between Apple and Google for the second round match-up. If you had to make all of your picks for the entire tournament up front, you would not have an opportunity to get points on this second round match-up because neither team that you picked in round 1, made it to round 2.Note: Players do not actually “buy” stocks in their account with March Money Madness.
What types of stocks are included in this and how are the match-ups chosen?
The bracket is broken down into four sectors: technology, financial, consumer, and industrial. Sixteen stocks from each sector are chosen for the competition. I choose the stocks in an effort to have some that are widely familiar to people (Nike, Apple, General Electric, etc.) mixed in with a few stocks that are less familiar and will require research. (See the entire list of 64 stocks from last year’s bracket here.)
How does one choose which stock will do better than the other?
This is what makes the game challenging and fun! Just like the games in the NCAA tournament, the outcome of these short-term match-ups are somewhat unpredictable, but doing your homework will help you make an educated prediction.
For example, if a company is releasing their quarterly earnings during one of the rounds and you expect that they will beat estimates, then you probably want to pick that stock because its price will likely go up.
If there are negative news stories affecting a company, then you may not want to pick that stock, as the news will likely negatively affect the stock price.
What can people learn about investing from March Money Madness?
What’s great about the competition is that you can test out your hypotheses about what makes stock prices move in the real market, and this experience can help you become a better investor.
After playing the game, players should be able to:
—Read and understand stock market information in the newspaper (USA Today, local paper, etc)
—Know where to go to find information on the market (Black Enterprise, WSJ, Barrons, Smartmoney)
—Know how to research past stock prices (Google Finance, Yahoo Finance, Morningstar)
—Understand issues that affect stock prices (revenue, earnings announcements, interest rates, unemployment reports, etc.)
—Gain a comfort level with the movement of stocks in the market (less fear of investing)
Know where to go to open an brokerage account if they want to start investing.
What’s your response for people who might liken this to gambling?
Some people feel as though the stock market in general is like gambling. However, your odds making money on your investments are much better than your odds of winning at the casino, especially when you do your homework and research the stocks that you want to invest in.
I don’t view this challenge as gambling at all. People join the challenge because they want to learn about the market, or they have some level of knowledge of the market and want to test their ability. This is no different than someone going to buy a book at Barnes and Noble because they want to learn about investing. I’ve just turned a traditionally boring subject, into a fun, educational, social experience and have given individuals an incentive to learn by providing prizes.
You did this last year. What was the outcome for the winners?
Many people who have played the game in the past knew nothing about the stock market. Joining the challenge pushed them to read the Wall Street Journal and other financial publications and Websites in order to do the research needed to make their picks. They began watching the market and gained some level of comfort with seeing stocks go up and go down. Ultimately many of them decided to open brokerage accounts with eTrade, Schwab and other firms to start investing in the market with real money.
How does social media play a role in promoting, marketing, and participation in MMM?
Absolutely! I am using Facebook, Twitter and e-mail marketing to help reach my goal of 100,000 players. Since I’ve created an incentive where the more people play, the more the winner can take home, there is an inherent incentive to share information on the challenge and to get friends to play along with you. I will also be partnering with a few individuals with large social media followings by making them “VIP Players” in the challenge that folks can match wits with and compare scores. For example, author and businessman Gary Vaynerchuk (@garyvee) has close to 1 million followers on Twitter and he will be a VIP player in the game that individuals can play against. His inclusion in the game and promotion of it via his social media accounts should help with the popularity of the game.
Games have become inherently social, and I hope that MMM is no different. Because people can form groups to play against their friends, my aim is to create a social experience where people can learn about the market together and encourage each other to become more knowledgeable about their finances.