Task:
Using Yahoo Finance, take a look at the five year chart for Wal-Mart. Using this chart and other information you can find on this company, write a two-page paper answering the following question:
Question 1: What do you think the futures price of 100 shares of Wal-Mart to be delivered to you in one year be right now?
Question 2: Do you expect the price of the shares in one year to be much higher? Or lower? Or only a little bit higher?
Question 3: How risky is the stock? Is its price prone to wild swings up and down? Or has the price been relatively stable the last few years?
Question 4: What alternative investments you have access to? What rate does your bank give you on a savings account or certificate of deposit? The greater return you can get on other investments, the less you should be willing to pay for an equity future.