Assignment:
Portfolio Selection: Random (Naïve) Diversification
Choose five common stocks using a random method of your choice. The stocks must be selected from the NYSE/AMEX or NASDAQ exchanges. The method for making a random selection is up to you, however, you mustdescribe your methodin sufficient detail that I can replicate it. Note: Do not include ETFs,preferred stock, bonds, rights, or warrants. Also avoid stocks that are in bankruptcy proceedings. For each stock, first, flip a coin to determine the exchange, second, use your random process to determine 1 to 5lettersfor the quote search in Yahoo! Finance or website of your choice.
While you aren't using information to select the stocks, get to know the companies you selected (and help me learn about them as well) by gathering information about them.In an appendix,please. You may provide additional information if you like, but for consistency (which makes my life easier) you must follow the instructions above first.
1. A cover page including 1) a thoroughjustification for why anyone would (rationally) randomly choose stocks for their long-term portfolio (theory and rationale please). Yes, there is a rational explanation (refer to Chapter 11 if you need help), and 2)adescription of the method you used to select the stocks in your portfolio. Make sure you describe the method of random selection in a manner that enables the reader (me) to replicate what you did.
2. Thesecond page should contain a table consolidating information on all five stocks. The tableshould list the company's name, ticker symbol, sector and industry, principle competitor, ranked by sales,and closing price on the date chosen. It should also list the median price target estimate by analysts, TTMEPS (earnings per share, trailing twelve months), annualforward(or forecasted) earningsper share estimates, forward P/E, Beta, market capitalization and PEG ratio.
NOTE: Use the template posted on Blackboard for your table.
I WILL NOT GRADE PAPERS WITH CUSTOM DESIGNED TABLES.
FOR CONSISTENCY, AND FOR THE PURPOSE OF EVALUATION AT THE END OF THE SEMESTER, AVOID STOCKS FOR WHICH ALL REQUIRED INFORMATION IS NOT AVAILABLE (NA)!Note that stocks which do not include dividends are acceptable, though the dividend may be listed as NA.
3. Document APPENDIX. Print the Summaryand Profile pages from Yahoo! Finance for each stock.