Portfolio Selection Paper

Portfolio Selection Paper - Investment Portfolio Project...

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Investment Portfolio Project 1 Investment Portfolio Project: Portfolio Selection Paper University of Phoenix- FIN 402 December 1, 2008 Introduction
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Investment Portfolio Project 2 This paper describes why these stocks, all from different industries, should be added to a portfolio. After researching data of many different stocks and funds the following were chosen to be added to a portfolio. They are: Home Depot, Procter Gamble, Ford Motor Co., General Electric, and Time Warner Inc. Ford Motor Co Stock The Ford Motor Company (ticker symbol F, NYSE) has had an unpredictable past five years of business, with stock prices ranging from $5.02 to $16.50. The average return for Ford Motor Company has been $9.95. The company falls under the industry of Auto Makers, along with Toyota Motor Company, Honda Motor Company, and General Motors Corporation. The Ford Motor Company started in 2003, with $9.93 and topped out the stock price with $16.50 in January 2004. Since then the stock has dropped to $5.02 and began to level off around the $7.50 range. Currently, the stock has recovered to same level of value from the previous year and over the last five years maintained a standard deviation rate of 3.06 (Google, 2008). The Ford Motor Company had a bad 2007 with -10.4 percent growth in stock value, however, it turned around in 2008 with a 22.9 percent growth in 2008. To assess the Ford stock to a company in the same industry; Toyota stock is much more expensive at a five year range of $44.65 - $138 stock price. Toyota has had -20.3 percent change in 2007 and has started 2008 with -1.2 percent change in stock value. While General Motors Corporation has similar declines and gains with a stock price ranging from $17.47 to $55.55 in the last five years and lost -16.4 percent growth in 2007 and -5.9 percent in 2008 (Morning Star, 2008).
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Investment Portfolio Project 3 The industry’s average, stock growth for the Auto Makers has been much lower than these three stocks, with a -49.7 percent growth for 2007. This highlights that the entire industry of Auto Makers is facing a decline in revenue and stock value. With a lower stock price and small deviation, the Ford Motor Company remains the preferred stock for Auto Makers industry. General Electric Stock General Electric is a well diversified global conglomerate. It has many lines of business that it is involved in. It has a large portion of it’s business tied to the retail market, but it has exposure in many different areas which also keeps it diversified. “General Electric Company (GE) is a diversified technology, media and financial services company. With products and services ranging from aircraft engines, power generation, water processing and security technology to medical imaging, business and consumer financing, media content and industrial products, it serves customers in more than 100 countries.” (Google Finance, 2008). With this range of markets and opportunities that the firm touches upon the prospects for business can be
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This note was uploaded on 08/17/2011 for the course BUS 200 taught by Professor Torres during the Spring '11 term at University of Phoenix.

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Portfolio Selection Paper - Investment Portfolio Project...

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