Stock Market Performance Task Introduction and Overview The Stock Market has a long history of highs and lows. Literally, the market experiences highs and lows daily. Companies sell shares to use the funds to improve or modernize their business. The New York Stock Exchange on Wall Street in New York stays busy Monday through Friday. Although discussions to buy or sell stock may occur 24 hours a day, the trades happen during official hours. Throughout the week various businesses or individuals open the market, and trading commences. Once trading begins, the frenzy of trading begins as well. The stock market becomes a very intense, stressful place. Many of the stock exchange traders are dealing with millions of dollars being exchanged daily. This handling of large sums of money can create an environment of high stress. If the market is going well, it is called a bull market. If it is not going well, the market is labeled as a bear. This really brings a whole new saying of "take the bull by the horns" or "bear with me." Other countries have their own stock markets, which at times influence the returns our stock market experiences. This can trigger our stock exchanges and create higher or lower markets. Today, you will complete a performance task in which you develop a strategy for how you would invest $5,000 in today's stock market. This performance task is broken into four parts. First, you will complete Parts 1-3 to prepare yourself with the skills you need for the final task (Part 4). Part 1: Examining Stock Data Learn how to examine a stock chart. The graph at right shows how Netflix stock has done in the past 5 192.02 Range 189.50 - 192 59 Diviyield 1.88 (-0.97%) 52 week 110.68 - 204 36 years. Circled is the current cost of 191.61 Shares 432 1 50 NASDAQ real time data . Discla Vol / Avg. 6.621/8.34M Beta one share of Netflix stock. If you Currency n USO Mkt cap 83.098 inst. own P/E bought one share of Netflix stock, it 194.26 would cost you $192.02. If you ld 5d 1m 3m 6m ty By Max Closing Free 192 bought ten shares, it would cost you $1,920.20. The down arrow and the straight- line show that at the beginning of 2013 Netflix stock only cost around $20 a share. If you bought ten shares of stock in January 2013, it would cost you $200. If you sold those ten shares today at their VOL 28.15M current value, you would get in return $1920.20 for a net profit of (1920.20-200.00) $1,720.20. 2014 2017 Now it's time to explore a chart on your own. Examine the data for Sony Corp stock below. 1. How much does one share of Sony stock cost today? 2. How much would 50 shares of Sony stock cost today? 3. How much would 50 shares of Sony stock cost in January 2013? 4. If you bought 50 shares of Sony stock in January 2013 and sold all of them today, what profit would you have earned? . Based on the Netflix chart and the Sony chart, if you had $1000 to spend today which company would you invest in and why? Sony Corp (ADR) (NYSE: SNE) 46.22 +0.33 (0.72%) 52 week Range 45.87 - 46.35 Div/yield 0.09/0.39 27.72 - 47.59 EPS 1.77 Nov 10 - Close Open 45.90 Shares 1.268 NYSE real-time data . Disc Vol / Avg. 715,351.00/1.06M Beta 1.81 Currency in USD Mkt cap 58.548 Inst. own 7% P/E 26.1 1d 5d 1m 3m 6m fy 5y Max Closing Price: 46 22 Vol: 5.245M 2013 2014 2015 2016 TodayPart 2: investing in Stock Examine three real stocks The stock market is like a game of chess, there are numerous strategies that could help you. some people like to take risks and invest in little known companies whose price per share is very low. They hope these businesses will be the next Netix and ma Ire them tons of money in the future. some people like to play it safe and invest in a company like Apple. The price per share is high, but the stock value steadily increases over time. some people like to invest in a stock that is doing poorly. The price per share is low and they hope the company will do better in the future. Look at 3 very dierent types of stock and see how they have done between 2013 and 2015: W. y. .. . > .zl- .m- nun... ' u ' ' ' ' Imus-m tln | . in: l . i l I ll "50 u u ' ' .l ' u an . . -' ' an it . l ' .. .. . ' \" s . "in \\- nu I\". I: i \"I,\" In III-I lien on '5'\" am )uu loss I all: all\" an am: am It?\" 00! CM! LC. Penny McDonald: Imagine it is January 1, 2015. You have 51000 to invest in the stock market. Your plan is to sell all your shares in 2017 and use your profits to buy a car. Based on the cost per share of each stock, how each stock has done in the past 2 years, and your own investment strategy prelerence, select the stock to invest in. Answer the following: What stock are you investing in? What is the price per share as of lanuary 1, 2015 (the end of the graph}? How many shares can you buy with your $1000? why did you select the company that you did? Explain in detail. PPP!' Part 3: Calculating Profit Perform calculations to determine whether you would have made a profit. If you had sold your stock as planned in 201?. would it have made a profit? The following activity will help you calculate your earnings. Examine the new charts below, which are updated to 201?. Then, answer the questions to determine whether you made a profit. ' V V 7 i (I . . i . ' l . 3:: MW in nu N" \"I n t in lo Coca Coil J.C. Penny Answerthe following: 1. What is the current price per share of the stocil. you invested in from Part 2? 2. llyou sold all your shares, how much money would you be left with? 3. Did you make a profit? If yes, how much? Part 4: Final Task invest $5,000.. Pretend your grow wants to invest $5,000. What corporation would you invest in and why