Wide-eyed students stock up on dollars, education in creating investment club

By 11:30 a.m. Tuesday, Wharton junior Jemarr Delauney's first stock trade had still not gone through. The stock market had lost more than 500 points the day before, but the stock Delauney wanted to purchase was slowly regaining the points it had lost. "I don't know what's going on," he said nervously, his eyes shifting to a nearby World Wide Web site flashing stock prices. "We were hoping to buy it before it went back up again." Such are the trials and tribulations Delauney and his partner College Junior James Nelson have faced since creating the Aspire Investment Club at the beginning of the 1996 school year. Aside from the usual troubles of starting up a group, Delauney and Nelson are also its only members. "We're going to open it up to other people in the spring," Nelson said. "We've had people asking us if they can get involved already." The capital used for purchasing stocks comes from matching $500 start-up investments by the club's two founders. "Education was always the first thing we had in mind," Delauney said. "If I lose that money, it's not a big deal because it's just to learn what we're doing." In the summer of 1996, a family friend involved in investments gave Nelson the idea of getting into the stock market. His first thought, he said, was to get "the people I knew at Penn involved so we could all learn together." But he readily admits that he had ulterior motives in trying to involve a larger group of people. "I thought that you needed a lot of money to start investing in the stock market," he said. "And I wanted to get other people into it." Nelson later told Delauney about the idea of founding an investment club, and the pair held a formal start-up meeting early in the year for interested students. But although several students attended the meeting, Nelson said he soon realized "that someone should know what's going on and have some knowledge before opening it up to other people," ultimately deciding to limit the club to two while they met with Penn faculty advisors and an investment manager at Charles Schwab on Wall Street. Their discussions with professional traders and financial experts taught them an important lesson. "We learned that you don't need a ton of money to invest in the market," Delauney said. "You can buy 10 shares of a big company, and that's better sometimes than 500 of a small and risky one." The two also learned that investors don't have to make handling their investments a full-time job. "When James first called me during the summer, I thought this would be a big deal and I wouldn't have time," Delauney said. "But you can invest and not spend hours thinking about it." Research, however, is still a big part of their club, Nelson said. The pair gets together at least once a week to discuss possible stock purchases, and the pair read The Wall Street Journal every day. "We bounce ideas off each other and tell the other all the reasons why we think of investing in a stock," Delauney said. "If one doesn't like it, we have to move on." Nelson hopes that through such experiences, they can better prepare future members of their club for investing. "It's important that we have our hands dirty and know what's going on," he said. Delauney also wants their club to show other students that investing is not just for "men in suits with funny jackets on, running around throwing small pieces of paper all over the place." He adds that the most important lesson they've learned is that "you can't get rich fast." Still, as he sat watching the stock prices flick across the computer screen Tuesday -- the club on the verge of making its first stock purchase -- he allowed himself to dream a little. "I hope this trade goes through," he said in reference to buying 10 shares of AT&T.; "I know it's not realistic, but we could make millions."