1. asset allocation overview
everyone starts with same amount of cash, same number of shares in a company
each round: you can buy or sell shares
end of each round:
receive interest on current cash
dividend announced; receive dividend payment for each share you own
final round: each share may have cash value
total payoff = end of game cash
interest rate; dividend and redemption value per share: same for all players
asset allocation
9A Playground for Decisions 9

2. your screen current round/total rounds 9 asset allocation
9A Playground for Decisions 9

3. your screen current cash & per-round interest rate 9 asset allocation
9A Playground for Decisions 9

4. your screen number of shares you currently own 9 asset allocation
9A Playground for Decisions 9

5. your screen possible per-round per-share dividends 9 asset allocation
9A Playground for Decisions 9

6. your screen end-of-game dollar value of each share 9 asset allocation
9A Playground for Decisions 9

7. the market for shares terminology you buy a share if
bid: offer to buy at a specified price
ask: offer to sell at a specified price
you buy a share if
you press “Buy at the Lowest Ask”; OR
you have the highest bid and someone agrees to sell at this price
you sell a share if
you press “Sell at the Highest Bid”; OR
you have the lowest ask and someone agrees to buy at this price
asset allocation
9A Playground for Decisions 9

8. transacting shares move slider to choose a price 9 asset allocation
9A Playground for Decisions 9

9. transacting shares press BUY or SELL to place order 9 asset allocation
9A Playground for Decisions 9

10. transacting shares current highest BIDS 9 asset allocation
9A Playground for Decisions 9

11. transacting shares press to sell at $1.65 9 asset allocation
9A Playground for Decisions 9

12. transacting shares current lowest ASKS 9 asset allocation
9A Playground for Decisions 9

13. transacting shares press to buy at $24.49 9 asset allocation
9A Playground for Decisions 9

14. transacting shares previous transactions in this round 9
asset allocation
9A Playground for Decisions 9

15. the market for shares you buy a share if you sell a share if
you press “Buy at the Lowest Ask”; OR
you have the highest bid and someone agrees to sell at this price
you sell a share if
you press “Sell at the Highest Bid”; OR
you have the lowest ask and someone agrees to buy at this price
constraints: can only sell shares you own or buy shares with money you have
asset allocation
9A Playground for Decisions 9

16. payoffs: an example happy playing! suppose payoffs calculated
redemption value=$2; interest rate=10%
begin final round: $77.40 and 4 shares
final round: sell 1 dividend=$0.40
payoffs calculated
Payoff =
cash(1+int rate) +
dividend*shares
redemption*shares
$95.20
($77.40+$2.60)(1.1)
$0.40(4-1)
$2.00(4-1)
happy playing!
asset allocation
9A Playground for Decisions 9