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Elementary Advice

THE BALTIMORE SUN

"Never invest in any idea you can't illustrate with a crayon," preaches stock market wizard Peter Lynch. He learned that lesson from some seventh-graders in Boston, whose classroom investment portfolio beat the market averages by nearly 200 percent in 1990-91. The kids did their homework, putting their imaginary money in real companies whose products and services they knew.

The market magic continues at Bakerfield Elementary School in Aberdeen, where a dozen fourth-grade girls beat out 1,100 other school teams in Maryland -- and all the professionally managed general equity mutual funds in the U.S. -- with their stock picks this year. The novice investors selected some familiar consumer names, plus a trucking company where a parent worked.

Their portfolio gained 11 percent while the overall market was decidedly down, winning the contest run by Loyola College. It was a heady introduction to economics and investments for the Harford youngsters, who still have to learn that yesterday's market winners can become tomorrow's losers.

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