The Finance Professor: Investments for Grads

Editor's note: In this installment of "The Finance Professor," Scott Rothbort answers a few reader questions.

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I would like to provide an investment as a high school graduation gift to a friend of mine. I like Vanguard, but don't really want to commit to its high minimums. Can you offer a mutual fund and/or stock(s) that would be good for a smart high school grad, so they can understand the value of investing, compounding, etc.? -- Lynne F.

I have two suggestions: A DRIP and an ETF. ...