Written Assignment - UNIT 7 BUS 1103 - Financial Markets and Public Economy PDF PDF

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Written Assignment Unit 7

University of the People Prof. ฀Alka Srivastava BUS1103

Unit 7: Financial Markets and Public Economy

3 August 2021

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Written Assignment | UNIT 7 Instructions: The stock market is an important factor in the global economy. This written assignment will give you a chance to analyze current stocks to help you comprehend the information you have been reviewing in Unit 7. As an individual, you can understand how using your household finances to invest in a publicly-traded company via bridging the gap by using financial capital markets. One form of a financial market is the stock market. It will allow the publicly traded companies to use a source to raise financial capital and for individuals to invest their money. For this assignment, you will: 1. Choose four stocks from the Yahoo Finance website (https://finance.yahoo.com/mostactive).! a. List the following information about the stock.

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The date that you chose the stocks! Stock Symbol Name of the company Price (Intraday) Change % Change Volume

b. Discuss why you have chosen the four stocks as an investor. 2. Discuss the trends of each stock’s performance over time. 3. Explain the rate of return for each of the stocks you have chosen. 4. Discuss the potential risks as an investor for each of the stocks that you have chosen. 5. Based on your research with the stocks you picked, explain what you think is the best investment type for you (bank accounts, bonds, stocks, mutual funds, or assets). Compose your paper using Microsoft Word or a Word compatible word processor (LibreOffice, Google Docs, etc.).! Your paper must be 2 pages in length using 12-point Times New Roman font and include an introduction, body, and conclusion. You must also cite sources using APA format.

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Written Assignment | Development: 1.

Choose!four!stocks!from the!Yahoo!Finance!website (https://finance.yahoo.com/ most-active).!

a.!List!the following!information!about the!stock.

1.

Paradox Interactive AB!

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The date that you chose the stocks!

3rd of August 2021

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Stock Symbol

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Name of the company

(PDX.ST)

Paradox Interactive AB!

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Price (Intraday)

$170.60 -> $167.30

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Change

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% Change

+ $3.3

= ($3.3/167.30)x100 = 1.97%

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Volume

113,432

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(II)!Marvell Technology, Inc.

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The date that you chose the stocks!

3rd of August 2021

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Stock Symbol

▪

Name of the company

(MRVL)

Marvell Technology, Inc.

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Price (Intraday)

$60.23 -> $60.63 Academic Report

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▪

Change

▪

% Change

- $0.4!

= (-$0.4/60.63)x100 = - 0.66%

▪

Volume

3,351,186

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(III)!QUALCOMM Incorporated

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The date that you chose the stocks!

3rd of August 2021

▪

Stock Symbol

▪

Name of the company

(QCOM)

QUALCOMM Incorporated

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Price (Intraday)

$149.40 -> $147.46

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Change

▪

% Change

+ $1.94

= ($1.94/147.46)x100 = 1.32%

▪

Volume

3,658,955

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(IV)!3M Company

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The date that you chose the stocks!

3rd of August 2021

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Stock Symbol

▪

Name of the company

(MMM)

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3M Company

▪

Price (Intraday)

$198.44 -> $201.68

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Change

▪

% Change

- $3.24

= (-3.24/201.68)x100! = - 1.61%

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Volume

1,104,952

b.!Discuss!why!you have!chosen!the!four!stocks!as an!investor. I have chosen these four stocks as an investor because of a few different reasons. First, because I enjoy their products and I have used their products, and I have been extremely satisfied. However, the most important reason is innovation and plausible uses to assist our civilization to progress and evolve in a more ethical, and sustainable way.! For example, Paradox Interactive AB is a gaming company that develops a variety of games, specialized in strategy and instruction. As well as management of resources in micro and macroeconomic ways. One example is CITIES: SKYLINES. A game based on the creation of a city; focused on the development of roads as its first aim, then transportation, allocation of natural resources, industries, offices, businesses, households, tourist attractions, sustainability or not (that is up to you). The game is super real in the way of how residents can be affected by the lack of education, firefighters, police, green areas, proper water filtration, garbage disposal, etc. The game is played mostly by adults due to its complexity and a lot of YouTube tutorials are done by architects and city planners. Some of them have recreated an entire metropolis like Shanghai, or Tokyo. Making me think about how this company could join forces with other architectural firms or governments to develop special software that translates what city planners do into architecture planning for cities. You may think that it is not gonna go that way. However, the new expansions of the game are focused on train stations, bridges & piers, Railways, Coastal cities, Green Cities, and even creating a civilization on Mars. Considering all those innovations; I believe that it is not far from the truth to speculate some kind of potential partnership with international and regional governments that will implement these apps/games as more interactive, enjoyable, and entertaining ways of doing these architectural projects/jobs.!

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2.!Discuss!the!trends!of!each!stock’s!performance!over time. Trends based solely on trendiness are not a good way of analyzing stocks and could be a double-edged sword when it comes to our ROR or rate of return. To have a more accurate analysis of the trendlines; investors have to check on the firm’s financial information (financial statements if possible); future projects or releases of merchandise, and as many other elements that could lead to a possible bull market (stock prices going up).!

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Paradox Interactive AB._!This company has a very stable and growing trend line, starting with their first optimistic IPO at $54.5; reaching a maximum value of $314 in 2020 during November or the lockdown-times, and coming back to a stable $166 as their last previous close. Even though their price has fallen, it is still higher than the price beforecovid19. Giving hopes of a plausible raise in stock prices in the following months.!

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Marvell Technology, Inc._!This organization's trend line is going upwards with a few falls that seem to be done by brokers and traders that live by doing stock exchanges. Making it seem that it is going into a bear market (downwards) every 3 to 6 months and raising its prices during these periods of time too. However, each bear market period has shown a higher value than the previous one. Making it seem like a perfect investment.!

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QUALCOMM Incorporated._!This is a similar organization to Marvell Technologies Inc. Even though, their trend lines are extremely similar. QUALCOMM Inc. posses a higher value that doubles the price of Marvell technology Inc. Giving us a very interesting clue about them. It may be time to invest in Marvell. However, just by analyzing their trendlines, we cannot be as sure about it. We need to research more financial information to arrive at a proper conclusion about it.!

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3M Company._!This is a very well-known organization that has patented the glue that is used in sticky notes and other types of glues. They also provide abrasives, adhesives, sealants, fillers (face masks), automotive parts & hardware, building materials, cleaning supplies, coatings, etc. Their products are made with the highest quality possible and considering environmental issues. Making it the brand of the future. Nonetheless, they are having free worldwide publicity by governments, medics, and people in general due to the 3M N95 filter it is the most

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reliable clothing filter to protect ourselves from covid-19 and 2.5 p.m. (particle matter) particles.!

3.!Explain!the!rate!of!return!for each of the stocks you!have!chosen. The ROR of each one of the stocks by using the INITIAL VALUE as the intraday beginning price and the CURRENT VALUE as the intraday closing price.! Therefore the ROR percentage will be the same as the percentage change. Assuming what I have stated above. We will start by explaining what these percentages mean.

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Paradox Interactive AB : ROR = [(Current Value - Initial Value)÷Initial value] x 100 !! ! ! ! = [(170.60 - 167.30)÷167.30] x 100

! ! ! ! = 1.97%

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Here, 1.97% ROR; which means that we will receive 1.97% more money than we spent when we bought the stock from Paradox Interactive AB at the beginning of the day. Making it a moderately good investment. However,! it may be suggested to wait longer if we want to increase our ROR.!

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Marvell Technology, Inc: = - 0.66%

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In this example, the ROR is a negative number (-0.66%). Showing a loss in the returns if we sell the stocks of Marvell Technology Inc at this particular given time. The best idea here is to analyze the company’s financial situation better and reconsider selling and lose 0.66% of the investment or wait patiently until the prices go up to a bull market. However, everything depends on further analysis.

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QUALCOMM Incorporated: = 1.32%

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For QUALCOMM Inc. we have a! 1.32% ROR; which means that we will receive 1.32% more money than we spent when we bought the stock from QUALCOMM Inc. at the beginning of the day. Making it a moderately good investment. However,! it may be suggested to wait longer and develop a further analysis (financial

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statements) that will lead us to a better conclusion on how to proceed.

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3M Company: = - 1.61%

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In this example, the ROR is a negative number (- 1.61%). Showing a loss in the returns if the stocks of Marvell Technology Inc. are sold at this particular time. Therefore, the best idea here is to analyze the company’s financial situation better and reconsider selling and lose 1.61% of the investment or wait patiently for the prices to go up to a bull market. However, everything depends on further analysis.

4.!Discuss!the potential!risks!as an!investor!for each of the!stocks!that you have!chosen. Risk and return it is a very important concept to have in mind at the time of investing in futures or stocks. While more risk, more possible returns, and vice versa (Kenton, 2021). As Warren Buffet, consider the best stock market investor of all times, said in one of his several interviews. “The only way to avoid the risks involved with the stock market is by believing in the company you are investing in and their products”. There is no tool, strategy, equation, or formula that will lead you to a better outcome than deeply knowing the company you are going to invest in, and believe in that their products are going to solve real problems in our society.!

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Paradox Interactive AB:!The risk with this company's investment is linked to the competition. If other game developers like Microsoft start putting an eye on this and starting to go towards the utility of their games as a city planning tool. Paradox could be subject to a merger or a forced acquisition by one of these giants like Microsoft or Apple.!

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Marvell Technology, Inc & QUALCOMM Incorporated::!These companies are based on telecommunications and especially 5G technologies. Reducing competition drastically due to the costs of putting satellites in orbit and creating land networks for the spreading of 5G signal. Therefore the risk here is minimum due to 5G technologies are already being implemented worldwide and with their capacity at 100x times faster than 4G. I believe most of the countries will adopt it eventually. Raising the stock prices of these two companies.!

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3M Company:!The risk with 3M is minimum. They have patented products for decades. Also, the extra publicity gained by CVID-19 and the N95 technology from 3M is making them virtually bulletproof in the long run. They may have some ups and downs; which are normal due to the brokers and hedge funds activity.!

5.!Based!on your!research!with the!stocks!you!picked,!explain!what you think is the!best!investment!type!for you (bank!accounts,!bonds,!stocks,!mutual!funds, or!assets). I believe that the best investment for all four are stocks that I will keep as fixed assets (long period of time). The reason is that I greatly believe in those companies and their products and projects. Nonetheless, I will need to do a further financial analysis of each one of these companies before investing in them. Finally, I would like to outline that I have never invested in the stock market. Therefore, it may be wise to start by purchasing bonds with a fairly short maturity so I can experience risk & return as a whole a few times before buying stocks as fixed assets.

References:

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Shapiro, D. & Steven A. (2011) Principles of Microeconomics 2e. Opens tax . Retrieved from https://d3bxy9euw4e147.cloudfront.net/oscms-prodcms/media/ documents/Microeconomics2e-OP.pdf Kenton, W. (2021). Rate of Return (RoR). Investopedia. Retrieved from https:// www.investopedia.com/terms/r/rateofreturn.asp

Word count: 1 700

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