A. Iselected Amazon stock because I believe it is a forward-thinking company. Amazon hasgrown from selling books online to an enormous infrastructure of warehouses fullof robots, immense computer systems, and wide-ranging delivery networks forjust about every product. Overthe last twenty years, Amazon has wisely invested in start-up companies thatadopted its technology early on. Zappos, the successfulonline shoe and clothing shop, is owned by Amazon. Evi, the software company that createstechnology aimed at improving the consumer internet and mobile experience, inparticular the Echo, is also owned by Amazon. The AmazonEcho sits in our leaving rooms ready to conveniently take verbal requests formore goods, from Amazon.
As well, with theintroduction of the shrewd and successful Amazon Prime program (no deliverycharges) Amazon Prime customers are buying over twice as many products asregular customers. This company hasshown a commitment to innovation, including developing a grocery store deliveryservice and stores that might eliminate the need for cashiers; flyingwarehouses; same-hour delivery by drones. The addition of a potential pharmacy could generate even more growth. Another reasonthat I bought Amazon stock is because it seemed like a safe investment. Thecompany’s earnings have steadily grown.
It is a multi-national conglomerate. The value of the company is almost a half-trilliondollars. The CEO of Amazon, Jeff Bezos,is a strong and responsible CEO.
He hashigh standards and attracts talented people with his vision, charisma, andability to deliver what he promises. Amazonhas constantly had a very high customer satisfaction index. Research references: Cohan, Peter. “4 Reasons To Buy Amazon Before It Hits $2,000In 2019.” Forbes Investing, 31 May 2017, www.forbes.com/sites/petercohan/2017/05/31/4-reasons-to-buy-amazon-before-it-hits-2000-in-2019/#76e50c124faaBerr, Jonathan.
“Amazon.com,Inc. (AMZN) Stock: $1 Trillion Doesn’t Matter.
” InvestorPlace, 11 April 2017, https://investorplace.com/2017/04/amazon-com-inc-amzn-stock-1-trillion-doesnt-matter/#.WiujzLaZPOR B. Amazon.com,Inc.
(AMZN) is listed on NASDAQ. Theresource I used for my stock ‘purchase’ and ‘sale’ reporting was nasdaq.com. Amazon’s total revenue in 2016 (period ending 12/31/2016)was 135.99 billion U.S. dollars and Amazon reported a net income of 2.37billion U.
S dollars. C. Theclosing price for Amazon on October 2 was $959.19 per share. I bought 10 shares. The total amount invested in Amazon was$9591.90. 959.
19 x109591.90 D. Twoweeks later, on October 16, I sold my ten shares at the closing price of$1006.34 per share for a total of $10,063.40. My profit per share was $47.15. Mytotal profit was $471.
50. 1006.34 x1010,063.40 E.
Thehighest closing price for Amazon during the holding period was 1006.34 pershare on the day I sold, October 16, 2017. The lowest closing price for Amazon during the holding period was 957.10per share on October 3, 2017. The 52-weekhigh was 1,213.41 per share.
The 52-weeklow was 747.70 per share. F. Amazondoes not pay a dividend to shareholders.
APPLEA. Ichose Apple stock because Apple is a progressive company. Apple hasgrown from a limited computer company to a mobile device leader. Since the launch of the very first iPod in2001, Apple shares have grown nearly 12,000%. The value of the company is almost $800 billion, which makes it perhapsthe most valuable publicly traded company. The company produced $45.69 billion of net profit last year.
Apple has approximately $246 billion in cash(more than the gross domestic product of most countries in the world. With a lot of cash, Apple can use this to growits profit. I believe Apple has hiredbright, innovative people – among them, Tim Cook, the current CEO. In addition, Apple is a trusted brand with loyalcustomers who keep coming back.
Peoplelove Apple products so much that they are willing to pay a higher price. Billionaire investor Warren Buffett firstinvested in Apple last year, and since this time he has doubled his investment. Because I knew I was only investing fortwo weeks, I felt the upcoming launch of Apple’s new iPhone X (released onNovember 3) would be boost a buzz of anticipation. Research references: Divine, John. “Should YouInvest in Apple (AAPL) Stock?” U.S.
News & World Report Money, 19 June 2017, https://money.usnews.com/investing/articles/2017-06-14/should-you-invest-in-apple-aapl-stock Vodicka, Michael. “Is Apple Stock a Good Buy?”Nasdaq, 30 June 2017, www.
nasdaq.com/article/is-apple-stock-a-good-buy-cm810745) A. AppleInc. (AAPL) is listed on NASDAQ. Theresource I used for my stock ‘purchase’ and ‘sale’ reporting was nasdaq.com. Apple’s total revenue for the one-year periodending 9/24/2016 was 215.
64 billion U.S. dollars and Apple reported a netincome of 45.69 billion U.S dollars. B. Theclosing price for Apple on October 2 was $153.81 per share.
I bought 67 shares. The total amount invested in Apple was$10,305.27. 153.81 x6710,305.27 C.
Twoweeks later, on October 16, I sold my 67 shares at the closing price of $159.88per share for a total of $10,711.96.
Myprofit per share was $6.07. My total profitwas $406.69. 159.
88 x6710,711.96 D. Thehighest closing price for Apple during the holding period was 159.88 per shareon October 16, 2017. The lowest closingprice for Apple during the holding period was 153.48 per share on October 4,2017. The 52 week high was 176.24 pershare.
The 52 week low was 110.60 pershare. E. Applepays quarterly cash dividends. InJanuary of this year, Apple paid 57 cents per share. In May, August, and November the company paid63 cents per share.
CATERPILLARA. Ichose Caterpillar stock because I believe it is an iconic brand and it is in a positionto grow. Caterpillaris the world’s leading manufacturer of construction and mining equipment. This company is arguably the mostrecognizable in the industry. Astrengthening worldwide economy leads to building and construction, which inturn leads to more construction equipment. As well, expected investmentsin infrastructure activities in the U.
S. and construction growth in China willbring a demand for Caterpillar’s products and services. Caterpillarhas also made wise management and business decisions to pursue globalcustomers.
The company positioned itselfto integrate and compete in foreign markets as a local company, rather than aforeign company. Caterpillar also has a long history of growth. According to Zack’sInvestment Research, Caterpillar has a Rank #1 (Strong Buy). Additionally, UBS Financial Services upgraded its Caterpillarrating from “Neutral” to “Buy.
” Research references: “Brokerage Recommendations” 8 December2017; Zacks.com website; https://www.zacks.com/stock/chart/CAT/broker-recommendations “Here’s Why Caterpillar Inc. (CAT) Is A StrongBuy Stock.” InvestorPlace, 24 May 2017, https://investorplace.com/2017/05/heres-why-caterpillar-cat-is-a-strong-buy-stock/#.
WiyX1raZPORKim, Tae. “Caterpillar Shares Hit a Recordafter UBS Upgrades on a U.S.
Construction Comeback ” cnbc.com, 18 September2017, www.cnbc.com/2017/09/18/caterpillar-shares-hit-a-record-after-ubs-upgrades.html) B. Caterpillar,Inc.
is listed on NASDAQ. The resource Iused for my stock ‘purchase’ and ‘sale’ reporting was nasdaq.com. Caterpillar total revenue for the one-yearperiod ending 12/31/2016 was 38.54 billion U.S. dollars and Caterpillarreported a net income loss of -67 million U.S dollars.
C. Theclosing price on October 2 was $124.72 per share. I bought 81 shares. The total amount invested in Caterpillar was$10,102.32. 124.
72 x8110,102.32 D. Twoweeks later, on October 16, I sold my 81 shares at the closing price of $131.47per share for a total of $10,649.
07. My profitper share was $6.75. My total profit was$546.
75. 131.47 x8110,649.07 E. Thehighest closing price for Caterpillar during the holding period was 131.
47 pershare on October 16, 2017. The lowestclosing price for Caterpillar during the holding period was 124.72 per share onOctober 2, 2017. The 52 week high was 145.19per share. The 52 week low was 90.34 pershare.
F. CaterpillarInc. pays quarterly cash dividends. In January and April of this year,Caterpillar paid 77 cents per share. InJuly and October, the company paid 78 cents per share. INVESTMENTS:Amazon: 9591.90Apple: 10,305.27Caterpillar: 10,102.
32Total investment: 29,999.49 RETURNS:Amazon: 10,063.40Apple: 10,711.96Caterpillar: 10,649.07Total return: 31,424.43 Total profit: 1424.94 G. Thereare many options to choose from when it comes to selecting the right brokeragefirm for me.
I chose to compare two largeinvestment broker companies: Fidelity Investmentsand TD Ameritrade. FidelityInvestments is one of the largest brokerage companies in the country, offering awide range of services and benefits to investors. The company charges $4.95 per trade, and theyrequire a $2,500 minimum account. Fidelity has low commissions, but it appearsto have a more complicated fee structure that make it hard to decipher hiddenfees.
Fidelity has a clear and relatively easy-to-navigateonline trading platform. Investors canaccess their accounts and make trades with Fidelity’s website or mobile app. Fortraders who don’t want to risk making all of their own investment choiceswithout advice, Fidelityoffers in-depth assistance (articles, research reports, videos, infographics,and webinars, etc.). This can be aninformation overload for beginners. Though, active traders might find this extensivedatabase of research reports useful. TD Ameritrade charges more per trade –$6.
95, and there is no account minimum. The pricing seems straightforward. This is good for the small trader.
TDAmeritrade seems to make up for high trading commissions with better service,research and trading tools that are geared to the beginning investor. Ultimately, knowledge is the most important advantage an investor can have. LikeFidelity, TD Ameritrade has a wide selection of educationalresources, user guides and webinars.
The TD Ameritrade platform seemssimpler to navigate with easy-to-access learning resources. One-on-one support is also something that Iwill want. (I prefer to be guided by aprofessional, at least at first.) Additionally,TD Ameritrade has a promotional offer that allowsnew customers to invest for free for the first two months, which seemslike a wise way to start. InBarron’s 2017 Online Broker Review,TD Ameritrade was recognized as #1 for Long-Term Investing, Usability, andNovices.
In order to choose the right broker, I mustconsider what kind of trader I am going to be. Will I move between stocks without holding them for a long time? Or will I buy and hold stocks for the longterm? A nice feature offered by TDAmeritrade and not offered by Fidelity is “virtual trading.” This is a process of simulated trading wherebeginner traders can practice investing without using real money. Trading strategies can be tested withoutrisk.
With practice, perhaps I willlearn what kind of trader I am, or will be. For these reasons, I believe TDAmeritrade seems like the best brokerage for me. Maybe Fidelity Investments would suit me inthe future as I become more confident.