Let's pretend you have a wealthy grandma who, on your 1st birthday, offered to buy you...
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Let's pretend you have a wealthy grandma who, on your 1st birthday, offered to buy you 100 shares of the stock of your choosing. In this project, you'll track how you would have done on this investment, depending on which company's shares you purchased. Part I: Pick 5 Companies Now, Grandma would only buy you one company's stock, but go ahead and pick 5 publicly owned companies that you could have chosen at the time. They must have existed on your 1st birthday and still exist now -- no sense choosing a bankrupt company. 1. My 1st birthday was on this date October 26, 2006 2. Complete the chart below with your 5 possible investments. If you need help finding historical stock prices on your birthday, watch this quick How To video (We are doing 1st Birthday, not 10th Birthday) and then use Yahoo Finance to research stocks. You may want to enter a five day window just in case your birthday was on a weekend or holiday. If your birthday was on a day the market was closed just choose the price for the day that is closest to your birthday. This website may help you with the sector for the companies you choose https://finviz.com/map.ashx Company Name Sector Primary Product/Service 1 2 3 4 50 Stock Ticker Symbol Adj. Close Price on 1st Birthday/Total Value (price x 100 shares for each) Current Value as of today (price x 100 shares for each) Total Value on your 1st Birthday (add 1-5 from column three together) $ Total Value TODAY (add 1-5 from column four $ together) Return on Investment from your five stocks https://www.calculator.net/roi-calculator.ht ml Money Market Return on Investment (Use Total Value from your 1st Birthday and 4.5%) https://www.kohlercu.com/resources/calcula tors/money-market-account-calculator/ (make monthly contribution ZERO) Savings Account Return on Investment (Use Total Value from your 1st Birthday and 1%) https://www.kohlercu.com/resources/calcula tors/saving-calculator/ (make monthly savings ZERO) /Annualiz $ ed ROI _% $ $ 3. What surprised you the most about the change in value of your chosen stocks? 4. How has this exercise impacted the way in which you will invest in the stock market in the near future? Part II: The Government Gets Theirs... Computing Capital Gains The government always wants its cut - even from investors. Taxes on financial transactions are referred to as 'Capital Gains.' Check out this Infographic to understand how Capital Gains Taxes work. Use the Capital Gains Tax Calculator (leave Location, Annual Income, and Filing Status to default settings) to estimate how much taxes you would have to pay on the stocks you chose. Record the amounts and total in this chart. 1 2 3 Company Name +A $ $ Profit Capital Gains Tax $ +A +A + 5 $ $ Total Capital Gains Tax (thanks to Grandma) +A +A $ Part III: You Be Grandma (or Grandpa) Now you're a grandparent! What five stocks would you buy for a new grandchild today? Make sure to consider the long-term promise of the companies you select. Company Name Industry Stock Ticker Current Value Primary Product or Service Symbol (as of today) 1 2 3 + 5 Let's pretend you have a wealthy grandma who, on your 1st birthday, offered to buy you 100 shares of the stock of your choosing. In this project, you'll track how you would have done on this investment, depending on which company's shares you purchased. Part I: Pick 5 Companies Now, Grandma would only buy you one company's stock, but go ahead and pick 5 publicly owned companies that you could have chosen at the time. They must have existed on your 1st birthday and still exist now -- no sense choosing a bankrupt company. 1. My 1st birthday was on this date October 26, 2006 2. Complete the chart below with your 5 possible investments. If you need help finding historical stock prices on your birthday, watch this quick How To video (We are doing 1st Birthday, not 10th Birthday) and then use Yahoo Finance to research stocks. You may want to enter a five day window just in case your birthday was on a weekend or holiday. If your birthday was on a day the market was closed just choose the price for the day that is closest to your birthday. This website may help you with the sector for the companies you choose https://finviz.com/map.ashx Company Name Sector Primary Product/Service 1 2 3 4 50 Stock Ticker Symbol Adj. Close Price on 1st Birthday/Total Value (price x 100 shares for each) Current Value as of today (price x 100 shares for each) Total Value on your 1st Birthday (add 1-5 from column three together) $ Total Value TODAY (add 1-5 from column four $ together) Return on Investment from your five stocks https://www.calculator.net/roi-calculator.ht ml Money Market Return on Investment (Use Total Value from your 1st Birthday and 4.5%) https://www.kohlercu.com/resources/calcula tors/money-market-account-calculator/ (make monthly contribution ZERO) Savings Account Return on Investment (Use Total Value from your 1st Birthday and 1%) https://www.kohlercu.com/resources/calcula tors/saving-calculator/ (make monthly savings ZERO) /Annualiz $ ed ROI _% $ $ 3. What surprised you the most about the change in value of your chosen stocks? 4. How has this exercise impacted the way in which you will invest in the stock market in the near future? Part II: The Government Gets Theirs... Computing Capital Gains The government always wants its cut - even from investors. Taxes on financial transactions are referred to as 'Capital Gains.' Check out this Infographic to understand how Capital Gains Taxes work. Use the Capital Gains Tax Calculator (leave Location, Annual Income, and Filing Status to default settings) to estimate how much taxes you would have to pay on the stocks you chose. Record the amounts and total in this chart. 1 2 3 Company Name +A $ $ Profit Capital Gains Tax $ +A +A + 5 $ $ Total Capital Gains Tax (thanks to Grandma) +A +A $ Part III: You Be Grandma (or Grandpa) Now you're a grandparent! What five stocks would you buy for a new grandchild today? Make sure to consider the long-term promise of the companies you select. Company Name Industry Stock Ticker Current Value Primary Product or Service Symbol (as of today) 1 2 3 + 5
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Related Book For
Fundamentals of Investing
ISBN: 978-0133075359
12th edition
Authors: Scott B. Smart, Lawrence J. Gitman, Michael D. Joehnk
Posted Date:
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