Apply It-Ch 14 Apply What You've Learned - Investing in Stocks and Bonds 1. Apply What You've Learned - Investing in Stocks and Bonds Scenario: You are 27 years old and willing to invest $1,250 every other month for the next 15 years. You prefer a conservative-to-moderate investment strategy and have a risk-averse to risk-neutral tolerance for risk. Your highest priority in your investment strategy is preparing you an any family that you might have in the future for your retirement, You also regularly set aside money into savings and cDs to pay for vacations or similar large-ticket items. You've assembled a table of information and company descriptions for some new stocks and bonds that you are thinkin about adding to your investment portfolio. Currently, your portfolio consists of 20 blue-chip stocks, and you're thinking about increasing your diversification by adding some different types of stocks. The following are descriptions of potential firms to be added to your portfolio: - Happy Dog Gas Company pays a cash dividend that is greater than most other companies, and has a beta of 0.90 . - Green Fish Semiconductor Company is a Iarge diversified provider of internet, network, and wireless services. It will be the first. firm to commercialize an underwater wifi system. - Black Sheep Broadcasting has the lion's share of the market and has widespread name recognition. The company earns aboveaverage eamings, pays reasonable dividends, and has a high P/E ratio. It has a beta of 1.75 . - Pheasant Pharmaceuticals is growing at a reasonable pace but pays a cash dividend that is greater than that paid by other pharmaceutical companies. The company's beta is 0.80 . If you wanted to invest in a income stock company (based on index), you should invest in If you wanted to invest in a tech stock company, you should invest in If you wanted to invest in a growth stock company, you should invest in If you wanted to invest in a income stock company (based on industry), you should invest in . Now, think about the available attributes of common and preferred stock issues and bond issues, and answer the following questions. If you want to invest in a security that pays you a fixed cash flow every quarter, then you should consider investing in If you want to invest in a security that allows you to participate in the selection of a company's management team, including its board of directors, then you should invest in If you want to ensure that you receive any unpaid, or skipped, dividend payments, then you should make sure that your preferred stock issue is Assume that you've selected the investments that you want to add to your portfolio. Now you must consider who to contact to make the purchases and the types of orders to place. If you wanted to discuss and verify your ideas with a real person (broker) and review firm-provided research reports, then you should use If you wanted to place a buy order that requires your new shares to be purchased at the best possible price that does not exceed a specified price then you should ask for a order. If you wanted to place a buy order that requires your new shares to be purchased at the current prevailing price with no other limits or special instructions then you should ask for order