Explain why individuals should specify investment goals and understand sources of risk and return Define basic investing terminology
1. You have $ 100,000 to invest in ten stocks, $ 10,000 in each ( no mutual funds). You may not alter your selections during the semester, and cash is not an option. ( Sorry; the purpose of this assignment is not to teach trading. Additional material will be added as the semester progresses.) Select an Internet source and set up a watch account.
2. One successful portfolio manager, Peter Lynch, has suggested that you should buy stock in companies that you know or whose products you use. Since this strategy may be as good a starting point as any to learn about investing, I have selected five stocks I know or whose products I use. You should select five and track your five against mine. Using the information in the previous assignment, set up a watch account that includes both sets. My stocks and their ticker symbols are Coca- Cola ( KO) ExxonMobil ( XOM) Merck ( MRK) Tupperware ( TUP) Washington Real Estate Investment Trust ( WRE)
Complete Problem 1 by setting up your watch account. Summarize the 10 stocks included in your watch account and why you chose each of those stocks. Complete Problem 2. Summarize the five stocks you chose and why you chose them.