OBJECTIVE: Student will complete research involving in investing in certain stocks and mutual funds,
and will recognize the importance of researching investments for inclusion into an investment portfolio.
RESOURCES: There are many web sites which give advice on investing in stocks and mutual funds.
Simply do a web search. You might also visit company websites for specific company information such as Coca Cola or IBM; visit investment sites such as MoneyCrashers or MarketWatch; and visit newspaper sites such as Wall Street Journal or local newspapers such as the Atlanta Journal & Constitution.
INSTRUCTIONS:
FORMAT: This paper should be double spaced, using correct grammar, spelling, and punctuation. There
should be the following sections in the paper:
STRATEGY (7 PTS)
STOCKS (48 PTS)
MUTUAL FUNDS (30 PTS)
CONCLUSION (5 PTS)
SPELLING/GRAMMAR/PUNCTUATION/SPACING worth 10 points. (-2 points per error for max of 10
points).
STRATEGY –
At the beginning of the paper, state your investment strategy and why you chose this strategy. All decisions made in the remainder of this project should be based on your investment strategy. The three
strategies are:
1. Income – You are looking to supplement your income by producing income on your stock or
funds. Look for stock or funds that pay dividends on a regular basis. Income stocks/funds are
often a wise investment for older investors, as they wish to supplement retirement income.
2. Growth – you are looking to hold on to the stock, giving it time to grow. You would then sell the
stock at, hopefully, a profit. Growth stocks/funds are often a wise investment for young investors, as they have time to let the stock/funds grow.
3. Both – a combination of the two.
STOCKS –
Choose stock in two publicly traded companies which are traded on either the New York Stock
Exchange, the American Stock Exchange, or NASDAQ. Your two stock choices should meet your
investment strategy chosen above. State why you chose the stock in these companies, using sound
investment reasons discussed as discussed in the course.in the course. (Note: Because I shop there, or
because I eat there, or my friend suggested it, etc., are not sound investment reasons.)
For each stock, include
• The name of the company in whose stock you are purchasing (4 pts),
• why you chose this stock and how it meets your strategy (4 pts),
• the stock symbol on the exchange (4 pts),
• a description of the company (4 pts),
• the name and a brief background of the CEO (4 pts),
• a brief statement about the stock history for the past year (4 pts),
• the current price of the stock (4 pts),
• how that price today compares to the price a year ago (4 pts),
• if the stock pays dividends, how much is paid and how often (4 pts),
• research on an internal or external issue which has affected the company’s stock (see paragraph
below) (8 pts), and
• a list of all resources used (may use url if online sources) (4 pts).
Internal vs. External issues: Research the news both past and present and find at least one item in the
news about the company that has either currently or in the past affected the value of the company’s
stock and identify the one situation as either internal or external.
Internal issues which affected the value of the company’s stock are caused by the company itself
and only affect the company. Some examples of internal issues are: Firing or hiring new leaders;
marketing a new produce; relocating; buying up another company; citations for safety or health
in which the company knew of the violations; new advertisements developed by the company or
successful or a bust; etc.
External issues are caused by occurrences outside of the company and affected the value of the company’s stock. Examples of external issues are: Competitor markets a new product which
draws sales from the company’s product; major storm destroys the company’s factory; price of oil goes up or down which affects shipping and delivery prices; competitor launches a major new
effective ad campaign; economy goes into a recession; etc.
MUTUAL FUNDS –
Your two mutual fund choices should meet your investment strategy chosen above. State sound investment reasons for choosing the two mutual funds.
For each mutual fund, include
• the name of the mutual fund (3 pts),
• why you chose this mutual fund and how it meets your strategy (3 pts),
• a description of the fund (3 pts),
• the objective of the fund (3 pts),
• the name and a brief background of the fund’s administrator (3 pts),
• a brief statement about the fund’s history for the past year (3 pts),
• the current Net Asset Value (sometimes called the price) for the fund (3 pts),
• how that Net Asset Value compares to one year ago (3 pts),
• if the fund has a Morningstar rating, give its rating (3 pts), and
• a list of all resources used (may use url if an online source) (3 pts).
CONCLUSION
Write a closing paragraph (conclusion) stating what you have learned about investing in stocks or
mutual funds from completing this report.
