Stock Portfolio Project

The major project for this course will consist of you constructing a portfolio of stocks. Your report should contain professional terminology, as well as proper grammar and spelling. Please don’t CUT and PASTE from websites. You should write in a professional manner, except in the reflective piece of the portfolio. Otherwise, all items should be parsed as if they were going to be reviewed by an executive at a financial institution.

The Stock Portfolio Project will consist of the following:

1. Create a portfolio of securities using one of the investment strategies below or another that you ‘create’. You can include in this portfolio any of the ‘allowed’ securities and can allocate your $100,000 in any way that you would like.
   1. Investing strategy:
      • Kitchen Cupboard
      • Biggest and Best
      • Specific Industry—e.g., all tech, healthcare, etc.
      • Recommended—e.g., from Motley Fool or other sites
      • Random ‘dart’ throw
      • High Risk
      • Safe Bets
      • Just Curious—Hunches
      • Follow the Leader—look at a successful investor and ‘mirror’ their picks
      • Other
   2. Describe and explain why you made the choices you did and what you would expect to learn from this initial portfolio position.
   3. You can make changes to this portfolio—i.e., adding, subtracting stocks, bonds, etc. You just need to record the changes you made.
2. Track the weekly performance of the securities in your portfolio, determining changes in price and return for individual securities. Also, determine the overall change in your portfolio’s value and your total return for each week.
3. For each week, monitor changes that could impact and/or help explain your portfolio’s performance. This information should include, but does not need to be limited to, the following:
   1. Performance of the overall market indices for the week—e.g., S&P 500, Dow Jones Industrial Average, NASDAQ, and other indices that might relate to securities in your portfolio, bond market, etc.
   2. Major development in the U.S. macro-economy
   3. Major developments internationally
   4. Any specific industry factors that may impact your investments
   5. Psychology of the market and country in general
4. Buy and sell securities as you would like over the next six weeks, but remain ‘true’ to your investing philosophy. When you make changes, describe the changes you made for that week and explain your investment approach—i.e., why you made the changes.
   1. Assess the ‘wisdom’ of these changes—i.e., how do these new investments perform?

Professional Portfolio Deliverables

Your final professional portfolio will contain the following sections:

• Introduction: In 1-2 pages, describe what your original strategy was in choosing your stocks and the strengths that you saw when you did so. Also highlight any areas you avoided. Please keep in mind that you will be evaluating these decisions and their merits in the reflective section.
• Stock portfolio: Create a professional presentation of all of the information you have gathered on your stocks throughout the term. Please keep in mind this is a professional presentation; therefore, matching fonts, styles, and readability will be considered in your grade.
• Prospectus: In 2-3 pages, suggest what should be done with your stock portfolio going forward. Cite examples from the data you collected while making your suggestions. Please consider which stock you believe will perform in the future and which you believe should be sold. Make sure to consider how long a position you would recommend holding for various stocks.
• Reflections: In one 2-3 page essay, speaking as a student and not as a hypothetical professional, answer the following questions.
  • Were you surprised by how your portfolio performed?
  • What factors impacted your initial stock selection, and how would the knowledge you have gained in this course have affected the selection if you had it to do all over again?
  • How did your perception of the state of the current economy affect your stock selection, and how would it have differed if the market were trending in the inverse direction?
  • What market indicators did you find to be the most informative and why?
  • Do you believe that deep research or intuition is a more important asset for an investor?