Week 8 Stock Journal Assignment
|PAPER TYPE||EXCEL SHEET COURSEWORK|
|# OF SOURCES||2|
|# OF PAGES & WORD COUNT||2 ≈ 550 WORDS|
USE THE TEMPLATE THAT I WILL PROVIDE AND ONLY WRITE FOR WEEK TWO
Capital markets and the ability to raise funds for corporate uses are essential to the U.S. economic system. For this assignment, imagine you have $25,000 to invest in U.S. companies. You are buying used stock.
You are investing, or buying, the stock because you believe the three companies you chose will make money and pay you a dividend in cash. Each share of stock that you buy entitles you to any dividend declared and a vote at the annual stockholders’ meeting.
The stocks you choose also allow you the ability to earn your money back by selling the stock. Of course, investing in stocks is risky, and there is the possibility that the stock you buy will be worthless when you want your money back. The company is not obligated to give you any of your money back. You will only get your money back if another investor wants to buy your stock.
Using the above scenario and the resources listed below, complete the following directions for your Week 2 Stock Journal entry:
Select three publicly traded U.S. companies, using your knowledge and experience, and make sure you are practicing good diversification. Diversification means you are not selecting three companies from the same industry. For example, you would not want to choose Target, Walmart and Sam’s because they sell the same types of products. A better choice would be Amazon, Uber, and Kroger, because they sell different products and/or services.
Ideas for sources of information: Go to Statistics, Surveys and Government Resources to find such companies. For stock price information, you may use the New York Stock Exchange, NASDAQ, Yahoo! Finance, or The Wall Street Journal Online.
Determine how you will divide $25,000 across the three companies (for example, $10,000 in Company 1, $10,000 in Company 2, and $5,000 in Company 3).
Decide the amount you are investing in each company. You do not have to provide any analysis to justify your decisions.
Provide a reason for picking each company.
For example, you might invest in Ford because that company gets a lot of your money, and you hear that Ford is doing well and will continue to do well.
Identify the number of shares you are buying, and the price of the shares you are buying for each company.
Once you decide the companies and the amount you will invest in each company, determine how many shares you can buy. For example, if Company 1 is selling for $42.16, then you may buy $10,000/$42.16, or 237.19 shares. But you cannot buy a part of a share, so you decide to buy either 237 or 238. In this example, you buy 237 shares at $42.16 per share, investing $9,991.92. You won’t be able to buy exactly $10,000, or $5,000, or $25,000, but it will be relatively close.
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