Research Project


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Research Project

  1. 1. Introduction Especially Activity “Who Owns What”, pgs 4-1 This is the pilot version of the SMG WORLDWIDE through 4-11; Activity “What Moves a Stock Price”, Investment Research Project. SMG pgs 4-21 through 4-29; Activity “What’s the WORLDWIDE, The Stock Market Game™ (SMG) Economic Weather?”, pgs 4-62 through 4-74. is an educational program of the Securities Industry Foundation for Economic Education The Stock Market Game Guide: Classroom (SIFEE), an affiliate of the Securities Industry Activities. Securities Industry Foundation for Association (SIA). Economic Education, 1993 Resources “Stock Market Adventure Video”, with host Peter Lynch. Several resources are available to help you teach your students the concepts addressed in the SMG Internet Resources WORLDWIDE Investment Research Project. There is an abundance of information available on Students will need additional resources to obtain the Web. However, it can be frustrating finding current data on companies as well as past the right site to answer your questions. The performance of these companies. These following is a brief list of sites that might act as resources are readily available from newspapers, potential starting points for your research: at public libraries, from stockbrokers, and on the Internet. Hoovers Online: S&P Personal Wealth: SMG Curricular Resources Yahoo! Finance: Registered Internet SMG Teachers can download print materials and individual lessons from their Administrative Advisor account. Learning From the Market; Integrating The Stock Market Game Across the Curriculum, National Council on Economic Education, 1997. Especially Lesson 14, “How to Choose a Stock”; Lesson 21, “How to Read an Annual Report”; Lesson 23, “Business Cycles and the Stock Market”; Lesson 24, “How Do Domestic and International Events Influence the Buying and Selling of Stocks?”. The SMG Teachers’ Guide to the Internet, Securities Industry Foundation for Economic Education, 1999. The SMG WORLDWIDE Investment Research Project was developed by the Securities Industry Foundation for Economic Education in partnership with the Illinois Council on Economic Education and the Pennsylvania Partnership for Economic Education. i
  2. 2. Abbreviated List of Industries Advertising Energy Oil Aerospace Engineering Paper Audio/Video Products Fiber Optics Publishing Automobiles Finance Real Estate Banks Food Retail Beverages Furniture Rubber Building and Construction Glass Products Shoes Broadcast – Radio and TV Hotels and Motels Steel Business Services Insurance Telecommunications Cable Television Internet Textile Chemical Leisure and Recreation Tools Coal Machinery Toys Computer Medical Transportation Cosmetics and Toiletries Metal Utilities Electrical Mining Electronic Commerce Motion Pictures The SMG WORLDWIDE Investment Research Project was developed by the Securities Industry Foundation for Economic Education in partnership with the Illinois Council on Economic Education and the Pennsylvania Partnership for Economic Education. ii
  3. 3. SMG WORLDWIDE Investment Research Project: Industry and Firm Selection (PART II. Section 1) With so many companies available on the New York Stock Exchange (NYSE), American Stock Exchange (AMEX), and the Nasdaq, how do you choose which ones are good investments? One way to do this is to first do research by industry. An industry is a group of companies that produce or sell the same kind of product or service. Select two industries from the list provided by your teacher and then choose two companies within each industry. Using the newspaper, Internet, or other resources complete the table below with information for each of these four companies. Industry Name Company Name Company Ticker Symbol Current Price of one Share of Stock Current P/E Ratio 52-Week High 52-Week Low Current Earnings per Share Have earnings per share gone up or down in the past three years?
  4. 4. SMG WORLDWIDE Investment Research Project: Company and Stock Selection (PART II. Section 2) Now that you have become familiar with what an industry is and some of the companies within a particular industry, it is time to invest in one of the companies you have researched in the previous section. Please answer the questions below. Be brief but informative. Answers will be judged on how well you rationalize your decision to invest in this particular company. Which industry have you chosen and why is it a better long term investment than the other industry you researched? In which company from the industry above have you chosen to invest? Provide its complete name and Ticker Symbol. What goods or services does the company you have chosen produce or offer to the public? If the company has subsidiaries, please include them.
  5. 5. Please give three reasons supporting your choice to invest in this company instead of the other company you researched in this industry. Please answer in complete sentences. What are the risks of investing in this company? Please consider all the factors that affect a company’s performance (legal proceedings, debt, ecological issues, social trends, technological advances, etc.)
  6. 6. SMG WORLDWIDE Investment Research Project: Influence of Events on Company Stock Prices (PART II. Section 3) Based on the research that you have done on your selected company, would your company’s stock price be affected by the following situations? Please check the box that applies and briefly explain your answers. Workers go on  Price Falls Price Rises strike No Effect Interest rates fall  Price Falls Price Rises No Effect People think we  Price Falls Price Rises are in a No Effect bull market Major oil- producing  Price Falls Price Rises nation No Effect reduces its supply of oil to the world New company  Price Falls Price Rises enters the No Effect industry