Stock Market Project Intro

Hey Everybody. Today I want to talk with you about the stock market project that we have due. Stock Market project is really kind of a right of passage for any student taking Economics. This is going to tie in with a lot of things that we have done and will continue to do in this class. Specifically, obviously, it's going to deal with what we've been talking about in terms of investments, but it will also give you an opportunity to do some research on different types of businesses, as well as how trade and other events can really impact the stock market and the accounts. So let's go through and talk about it together and any questions you might have hopefully I will be able to answer them. First of all you're going to select a total of three stocks and they need to be from either the New York Stock Exchange or the NASDAQ, and we'll talk about later how you can make sure that they are on the New York Stock Exchange or the NASDAQ. You'll trade them for a totally of 10 days, and that's 10 trading days, which is Monday through Friday; they do not trade on the weekends. You're going to have a total of $100,000 to work with and you can divide it up in whatever terms you want to. So you could divide it evenly with $34,000 $33,000 and $33,000 or you could invest more heavily in one, like $50,000 and then 20 and 30 thousand in the other two. That's totally up to you, however you want to do it. And it's going to depend also on how much stocks are costing. Apple and Google are extremely expensive, anywhere between 5 and 800 dollars per share. Where as other companies are going to be much less. Target is around $70 a share, Microsoft is around $25 a share, Bank of America is around $12. So it can really run the gamete in terms of what the stocks cost. How much you want to spend within each company is going to be important for you to decide. You're going to maintain a log, which we'll talk about in a minute. And that's just going to maintain what you're spending, how much you've spent on those specific days. You're going to create 4 line graphs: 1 separate line graph for each stock demonstrating the price of the share for each of the 10 days, and then the fourth line graph is going to illustrate the total value of the stock. So that's going to be a really large number, like $100,000 on the first day. And then you're going to create a report. The report is going to research the company itself, the history and the origin, the location of headquarters and larger plants. For places like Target and Wal-Mart, you're going to want to research where their distribution centers are, as well. Recent buyouts, and mergers, and acquisitions are going to be relative to the company; recent in terms of when is it the most recent for that company. For some companies they may merge and have acquisitions within the past week or the past year, others may not have had one in the past 50 years. Product or services that are produced, reasons that explain the performance of the stock, 3 criteria used in selecting the stocks. And that's just simply 'why did you choose that stock', and then the financial stability of the corporations. That's where you want to look at profit margins, and revenue, cash flow, those types of things. And then at the end of the 10 days you need to do your financial statement, and again I'll show you that here in a minute. The rubric follows, it's pretty self explanatory, and you can see all your point values there. The next thing you'll see there is your closing financial statement where you will display the number of shares purchased, the total purchase price, which will be how much you bought it for on day 1 at closing. And then the selling price is how much it would sell for at closing on day 10. Total profit or loss: meaning how much money did you make or lose over those ten days. Commission that you have to pay to your broker. And then what's your total value once you subtract that. And then the last page is your log where you will record the date, the closing price, and then just the change in price.