Question

WEEK 3 STOCK JOURNAL

STOCKS	1	2	3
Name	Apple	Amazon	Accenture
Reason for Selection	I love the products of Apple. I have used its iPhone and iPad and I really like them. They are doing well and will continue to do in future as technology improves and penetration of handheld devices increases across the globe.	I have brought some products on line using the platform of this company. My experience was good. Amazon has ousted Microsoft to become the largest company in terms of market capitalization recently. I am quite sure this company will do quite well as internet penetration improves across the globe.	I have heard a lot about the management consulting. Technology and outsourcing platforms of Accenture. They have growth platforms quite relevant to the industry. Their advisory services to the client are excellent. The company is nearly debt free and has strong financials.
Current Share Price ($), P	152.29	1640.56	146.23
Amount Allocated ($), F	8,000.00	10,000.00	7,000.00
No. of Shares, M = F / P	52.53	6.10	47.87
Integral No. of Shares, N	53.00	6.00	48.00
Funds Actually Invested ($) = N x P	8,071.37	9,843.36	7,019.04
Total Funds Invested ($)	24,933.77	(Sum of above three values close to 25,000 but not exactly 25,000)

WEEK 8 STOCK JOURNAL

Stock	Week 3 Price	Investment Amount	Nos. of Shares Bought	Week 8 Price	Investment Value in Week 8	Gain Loss
	$ / share	$	Nos.	$
	A	B	C = B / A	D	E = D x C	F = E - B
Accenture	148	3,700	25	160	4,000	300
Amazon	1,632	16,320	10	1,627	16,270	(50)
Apple	153	4,900	32	171	5,472	572
Total		24,920			25,742	822

This is the week you have been waiting for – to see if you are walking home a ‘pretend’ millionaire, or whether you would be finding a side job to recoup your losses.

For Week 10, review your investment for the last time. You must:

1. Record the current price of the stock for each company you selected in Week 3’s Stock Journal. You may use any price during this week (e.g., day one price, the opening, the low, the high, the close, or any price you find when you check it during the day). Using a MS Excel spreadsheet or MS Word document, put your Week 8 and Week 10 stock prices side-by-side, to show the comparison.
2. Determine the total value of your investment.
3. Provide your final opinion / assessment of your investments. Did you make money or lose money? Discuss your results and, based on hindsight, describe what you would do differently.
4. Discuss what you learned from this assignment. Do you believe this assignment will help you in the future in any way?

Answer 1

WEEK 8 STOCK JOURNAL
Stock	Week 3 Price	Investment Amount	Nos. of Shares Bought	Week 8 Price	Investment Value in Week 8	Gain/ Loss in week 8	Week 10 Price (as of 5th Mar EOD)	Investment Value in Week 10	Gain/ Loss in week 10	% Gain/ Loss in week 10	Change in week 10 as compared to week 8
	$ / share	$	Nos.	$	$	$	$	$	$	%	$
	A	B	C = B / A	D	E = D x C	F = E - B	G	H = G x C	I = H - B	J = (H - B)/B *100	K = H - E
Accenture	148	3,700	25	160	4,000	300	163.67	4,092	391.75	10.59%	91.75
Amazon	1,632	16,320	10	1,627	16,270	-50	1,692.43	16,924	604.30	3.70%	654.30
Apple	153	4,900	32	171	5,476	576	175.53	5,622	721.55	14.73%	145.08
Total		24,920			25,746	826		26,638	1,717.60	6.89%	891.13

The prices noted in week 3 and in week 8 are different and the number of shares purchased for each company are also different. We will assume that the information presented in week 8 is the most updated one and we will calculate the profit/ loss from this information.
Overall the portfolio has made profit. This is not a realized gain since the stock holdings are not yet sold. Once the stocks are sold at the week 10 price, the gains will be realized gains
The value of each stock has increased from week 3 to week 10. However, the largest % gain in seen in Apple. Hence, the portfolio would have made higher profit if maximum allocation was made to Apple. This of course, is a retrospective decision and it is difficult to estimate the price changes in a short period for any stock.
It can be said that a company which is very strong fundamentally and has an excellent value proposition will most likely perform better in business. This growth in business will be seen in the share price as well. However, for periods as small as 10 weeks, the factors that impact the share prices are different. News, technical charts, analyst expectations etc. impact the share price more in short term than in long term. Hence, we need to look at all the factors holistically.