MTV Game Show Proves Wall Street
Is Now Hot With the Young Crowd
March 2, 2000
By DANIELLE SESSA
Staff Reporter of THE WALL STREET JOURNAL
Ten years ago, the mere mention of stocks and investing would send the MTV music-channel crowd reaching for the remote control. The reaction: Yeah, right.
But now, thanks to the Internet and a prolonged bull market that has penetrated the psyche of even young America, Wall Street is almost as hot as the Backstreet Boys. Proof of that: The youth-obsessed MTV channel is now doling out credits, instead of cash, for online stock-trading through E*Trade Group Inc., as prizes on one of its most-popular game shows.
"The whole notion of trading stocks and bonds, the Web and e-commerce is a lot of where pop culture is right now," says John Shea, vice president of strategic programming of MTV, a unit of Viacom Inc. "When we were thinking about how we give away these prizes, we thought it would be more interesting to do a deal like this instead of giving away cash."
The MTV show giving away these credits features two teams of six twentysomethings each that compete in such off-the-wall games as grappling with midget wrestlers and driving cars in a demolition derby. The winning team gets a certificate for "10,000 E*Trade dollars." This represents real money, which is deposited into an account with the online broker, and the team decides as a group, on the show, how to invest the winnings.
Huddling Around Laptops
So far, actual stock-picking has played only a small role in the show, with most of the footage ending up on the cutting-room floor. But one segment briefly showed the novice investor teams huddled around laptops anxiously buying stocks with just a few clicks of a mouse. The show is called "Real World/Road Rules Challenge 2000," so named because the contestants are young people who appeared in previous seasons on the real-life shows "Real World" and "Road Rules."
Micheal Sievert, vice president of marketing for E*Trade, says sponsoring the show was a move to "connect with a younger audience that will inherit the wealth of the baby-boom generation." The core client age for the Menlo Park, Calif., online brokerage firm is 30 to 45. E*Trade declined to give an exact number of clients in the 18-to-30 age category but did say that the number is in the lower end of the bell curve of its two million accounts.
So, how did the group of twentysomethings do with their stock-picking?
By the time the cameras stopped rolling in November on this year's shows, the veterans of "Road Rules" had reeled in $60,000 to use for stock trading, while "Real World" won $40,000.
While the game show's participants were excited to receive such hefty rewards for bungee jumping and entering pie-eating contests, the real challenge was how to invest their winnings.
Devising Strategies
"We had no idea that we would have to put some intellectual thought into our money-making activities," says Holly Shand, a 22-year-old from "Road Rules."
Few of shows' cast members had any financial background. "Real World" veteran Kat Ogden, 24, bought some investing books to read up on the stock market, and "Road Rules" alum Dan Setzler, 22, used the Internet to research companies. Other cast members would watch CNBC and take notes on what stocks were moving that day.
The Gen Xers ended up adopting an investing style that would make Peter Lynch, the silver-haired Fidelity Investments pitchman, proud: Own what you know.
American Express Co., General Electric Co., General Mills Inc. and Hershey Foods Corp. were among the blue-chips snapped up by the teams.
"We tried to pick a few stocks and spread them out over a couple industries," says Mr. Setzler, whose father is an investment banker. "We had the whole mentality of 'Let's not screw up here.' "
Even though the teams shunned most risky dot-coms, the "Road Rules" team did take a chance on a wireless-technology company. The stock turned out to be one of the best-performing stocks of 1999: Qualcomm Inc. Mr. Setzler recommended buying some shares because he liked its ads.
The "Road Rules" team rode the back of Qualcomm's rocketing stock price to post an 11.5%, or $6,875, return on their portfolio over two months. "Real World" didn't fare as well. Drops in General Mills and Seagram Co. pulled the portfolio down to $39,945, a shade below what they won.
To put the performances in perspective, the Standard & Poor's 500-stock index rose 10% during the time that the teams played the stock market.
One thing that youth culture and investing has in common: It leads to arguments. And that's good TV. "Anytime you are dealing with finances," says Ms. Ogden, "it really gets under people's collars."
Write to Danielle Sessa at danielle.sessa@wsj.com |
