Inquiry into Hamlet / Poetry Essay
Instructions: As an extension of the Hamlet unit, students will write an inquiry essay on a topic inspired by the tragedy of Hamlet. This essay will be between 900-1200 words in length. Evidence for the essay will be balanced equally between specific quotations from three poems and the play, Hamlet.
Step One: Working in small groups, students will engage in a thorough, line by line analysis of one of the soliloquies of Hamlet and share their analysis with the class.
Step Two: Students will select an inquiry topic from Hamlet and construct 2-3 inquiry questions about the topic. Students should not have preconceived answers to the questions.
Step Three: Gather specific evidence from the play, Hamlet, that relates to the inquiry topic. Topics that do not have sufficient evidence from the play will have to be reconsidered.
Step Four: Students will select three poems from three different poets that specifically relate to the inquiry topic. Each of the poems must come from a different time period, and different forms of poetry should be included. Poems must be sufficient in length to make meaningful connections to the inquiry topic with specific evidence. You may use no more than ONE of the poems analyzed in class.
Major Literary Eras: Traditional Poetic Forms: Non-traditional Poetic Forms:
The Middle Ages. (c.750-1485) Ballad Dramatic Monologue or Soliloquy
The Renaissance (1485-1660) Elegy Nursery Rhyme and Nonsense Verse
The Restoration of the Eighteenth Century (1660-1700) Free Verse Prose Poetry
The Romantic Period (1784-1837) Ode Rant
The Victorian Age (1837-1914) Sonnet Shape or Concrete Poetry
The Modern Period (1914~) Villanelle Song (including rap)
(Consult with the teacher if you would like to include an example of a poetic text that is not indicated here as one of your three poems.)
Step Five: ANALYSIS Original and thorough analysis of each of the three poems will be conducted and evaluated as part of the writing process. In addition to analyzing for meaning, students will consider poetic devices, structure and style. Key quotations from each of the poems will be used as evidence.
Step Six: OUTLINE: Students will determine the structure of the essay in a formal, fully-conceived outline. Consideration of the various essay methods of development is advised. Location of thesis and order of arguments, as well as the specific inclusion of evidence, needs to be determined and included in the outline. The formal outline, including inquiry questions, thesis, arguments, and evidence, in order, will be evaluated as part of the process. This is a mandatory component of the essay.
Step Seven: Consult with the teacher (if necessary), specifically focusing on the inquiry questions and thesis, construction of arguments, and use of evidence from multiple texts.
Step Eight: ROUGH DRAFTS: Write the rough draft and engage in detailed editing. Students must have a minimum of tw.
PSYPACT- Practicing Over State Lines May 2024.pptx
Inquiry into Hamlet Poetry EssayInstructions As an exte.docx
1. Inquiry into Hamlet / Poetry Essay
Instructions: As an extension of the Hamlet unit, students will
write an inquiry essay on a topic inspired by the tragedy of
Hamlet. This essay will be between 900-1200 words in length.
Evidence for the essay will be balanced equally between
specific quotations from three poems and the play, Hamlet.
Step One: Working in small groups, students will engage in a
thorough, line by line analysis of one of the soliloquies of
Hamlet and share their analysis with the class.
Step Two: Students will select an inquiry topic from Hamlet and
construct 2-3 inquiry questions about the topic. Students should
not have preconceived answers to the questions.
Step Three: Gather specific evidence from the play, Hamlet,
that relates to the inquiry topic. Topics that do not have
sufficient evidence from the play will have to be reconsidered.
Step Four: Students will select three poems from three different
poets that specifically relate to the inquiry topic. Each of the
poems must come from a different time period, and different
forms of poetry should be included. Poems must be sufficient
in length to make meaningful connections to the inquiry topic
with specific evidence. You may use no more than ONE of the
poems analyzed in class.
Major Literary Eras: Traditional Poetic
Forms: Non-traditional Poetic Forms:
2. The Middle Ages. (c.750-1485) Ballad Dramatic
Monologue or Soliloquy
The Renaissance (1485-1660) Elegy Nursery Rhyme
and Nonsense Verse
The Restoration of the Eighteenth Century (1660-1700) Free
Verse Prose Poetry
The Romantic Period (1784-1837) Ode
Rant
The Victorian Age (1837-1914) Sonnet
Shape or Concrete Poetry
The Modern Period (1914~) Villanelle Song
(including rap)
(Consult with the teacher if you would like to include an
example of a poetic text that is not indicated here as one of your
three poems.)
Step Five: ANALYSIS Original and thorough analysis of each
of the three poems will be conducted and evaluated as part of
the writing process. In addition to analyzing for meaning,
students will consider poetic devices, structure and style. Key
quotations from each of the poems will be used as evidence.
Step Six: OUTLINE: Students will determine the structure of
the essay in a formal, fully-conceived outline. Consideration of
the various essay methods of development is advised. Location
of thesis and order of arguments, as well as the specific
inclusion of evidence, needs to be determined and included in
the outline. The formal outline, including inquiry questions,
thesis, arguments, and evidence, in order, will be evaluated as
part of the process. This is a mandatory component of the
essay.
Step Seven: Consult with the teacher (if necessary), specifically
focusing on the inquiry questions and thesis, construction of
3. arguments, and use of evidence from multiple texts.
Step Eight: ROUGH DRAFTS: Write the rough draft and engage
in detailed editing. Students must have a minimum of two peers
from the class edit their work and a minimum of one self-edited
draft of the essay. Comments, criticisms and suggestions for
improvements must be visibly shown by both the peer editors
and the author in all drafts. Any planning, gathering of evidence
and resources, even if it is not used, should be included to show
the essay writing and inquiry process. Essays without visible
editing will not be accepted.
Step Nine: WORKS CITED: Construct a works cited and ensure
that embedded references for all evidence taken from the poems
and the play are included. Use MLA format for the works cited
and quotations.
Step Ten: GOOD COPY: Submit the good copy of the essay to
Turn-it-in on Moodle. . ALL SUBMISSION PIECES (5 items)
AS CAPITALIZED ABOVE MUST BE SUBMITTED ON
PAPER COPY.
*Students are advised to consult with their teacher at any stage
in the process where they need assistance.
Students should not wait until the due date to communicate their
concerns.*
4. Inquiry into Hamlet Essay Rubric for
Evaluation and Assessment
Categories/
Levels
Mark
Totals
Level 4
80-100%
Level 3
70-79%
Level 2
60-69%
Level 1
50-59%
Level R
0-49%
Knowledge and Understanding
-Demonstrates knowledge and understanding of the play ( /10)
-Demonstrates knowledge and understanding of the three poems
( /20)
/30
Insightful and thorough understanding of the play is
demonstrated in both the outline (process) and the essay
5. (product)
Insightful and thorough understanding of the poems is
demonstrated in both the analysis (process) and the essay
(product)
Thorough understanding of the play is demonstrated in both the
outline (process) and the essay (product)
Thorough understanding of the poems is demonstrated in both
the analysis (process) and the essay (product)
Good understanding of the play is demonstrated in both the
outline (process) and the essay (product)
Good understanding of the poems is demonstrated in both the
analysis (process) and the essay (product)
Some understanding of the play is demonstrated in both the
outline (process) and the essay (product)
Some understanding of the poems is demonstrated in both the
analysis (process) and the essay (product)
Insufficient
Evidence
Thinking
-Investigates effective inquiry questions and constructs a related
thesis ( /10)
-Selects, integrates, explains and connects evidence from the
play ( /10)
-Selects, integrates, explains and connects evidence from the
poems
6. ( /10)
/30
Insightful and original inquiry questions are fully explored and
answered with a compelling, specific and arguable thesis
Relevant and original choices of evidence are integrated and
explained with subtlety and style
Relevant and original choices of evidence are integrated and
explained with subtlety and style
Clear and relevant inquiry questions are explored and answered
with a related, specific and arguable thesis
Relevant and effective choices of evidence from the play are
integrated effectively
Relevant and effective choices of evidence from the poems are
integrated effectively
Relevant and somewhat clear inquiry questions are explored and
answered with a related and arguable thesis
Relevant choices of evidence from the play are integrated with
7. some effectiveness
Relevant choices of evidence from the poems are integrated
with some effectiveness
Inquiry questions are explored and answered with a related
thesis
Choices of evidence from the play are integrated with
inconsistent effectiveness
Choices of evidence from the poems are integrated with
inconsistent effectiveness
Insufficient
Evidence
Communication
-Organizes essay using an effective structure ( /5)
-Uses proper essay format ( /5)
-Uses a consistent, effective and appropriate style and tone ( /5)
-Uses proper grammar and effective diction
( /5)
/20
8. An original, appropriate and fully-developed structure has been
constructed
Essay format is flawless (font size, indenting, double spacing,
margins, original title, page
numbers, etc.)
Style and tone are appropriate, consistent, confident and
compelling
Grammar is flawless; diction is consistent, appropriate and
effective
An appropriate and fully-developed structure has been
constructed
Essay format is virtually flawless with no significant errors
Style and tone are appropriate and consistent
Grammar is virtually flawless, diction is consistent, appropriate
and largely effective
A related and inconsistently- developed structure has been
constructed
Essay format has no significant errors
9. Style and tone are appropriate but somewhat inconsistent
Grammar has no major errors; diction is consistent, appropriate
and somewhat effective
A partially-developed structure has been constructed
Essay format has some significant errors
Style and tone are inconsistent and partially effective
Grammar has some major errors; diction is inconsistent, and
somewhat appropriate
Insufficient
Evidence
Application
-Cites all evidence using MLA format and cites all resources
using an MLA works cited ( /5)
-Uses the writing process (outline, visible peer editing by two
peers, and self-editing) ( /10)
-Writing Process- 3 poems from different time periods analyzed
for devices, significance and style( /5)
10. /20
MLA works cited has a minimum of four sources flawlessly
cited;quotations are properly cited and MLA formatted
Outline is detailed and comprehensive with all elements
included; three drafts of the essay have been visibly and
thoroughly edited by two peers and the author
Process and analysis completed
thoroughly and with insight
MLA works cited has a minimum of three sources cited
correctly; quotations are cited and MLA formatted
Outline is complete with all elements included; three drafts of
the essay have been visibly and completely edited by two peers
and the author
Process and analysis completed effectively
MLA format has two to three sources that are cited with no
major errors; quotations are cited but not MLA formatted
consistently
Outline is partially complete with most elements included; three
drafts of the essay have been edited by two peers and the
author
11. Process and analysis completed, with some effectiveness
MLA has several sources that cited with some major errors;
quotations are inconsistently cited without using MLA format
Outline is incomplete with some elements included; multiple
drafts of the essay have been edited by peers and the author
Process and analysis completed with limited effectiveness
Insufficient
Evidence
Poetry Essay Process Work
This is the location for all of your process work from
brainstorming to editing. (I have enabled the sharing feature so
you will be able to share this doc with peer editors)
Developing an Inquiry Focus
What topics am I most curious about? (Coming from the Hamlet
with a focus on the soliloquies).
What topics can I take outside of the play in a general way?
(The play will only be one source of evidence for your research,
12. so you must have topic ideas that you can explore outside of the
play.)
What am I specifically interested in? List questions that you
have regarding one of the topics listed above.
What is my BIG INQUIRY QUESTION?
This is going to drive your research.
The Soliloquies of Hamlet
Instructions: Students will work in groups to analyze one of the
soliloquies from Hamlet.
Analysis should start with understanding the context of the
speech (when, where, who, what, why, and how is the speech
happening, considering its place in the play).
13. Next, the group will analyze the speech line by line to
understand the content of the speech, and identify how poetic
and dramatic devices complement the speech.
Each group will determine how their speech is structured and
what the key questions are that the speaker is grappling with.
Students will record their overall analysis in the “What’s Going
on in Hamlet’s Head?” document before sharing their analysis
with the class in an informal presentation.
***Try to brainstorm topics and inquiry questions for each
topic. Don’t worry if they sound far-fetched - this is what
brainstorming is about.
1. Act I, scene ii
Hamlet:
O that this too too solid flesh would melt,
Thaw, and resolve itself into a dew!
Or that the Everlasting had not fix'd
His canon 'gainst self-slaughter! O God! O God!
How weary, stale, flat, and unprofitable
Seem to me all the uses of this world!
Fie on't! O fie! 'tis an unweeded garden,
That grows to seed; things rank and gross in nature
Possess it merely. That it should come to this!
But two months dead! — nay, not so much, not two:----
So excellent a king; that was, to this,
Hyperion to a satyr; so loving to my mother,
14. That he might not beteem the winds of heaven
Visit her face too roughly. Heaven and earth!
Must I remember? Why, she would hang on him
As if increase of appetite had grown
By what it fed on: and yet, within a month, —
Let me not think on't, — Frailty, thy name is woman! —
A little month; or ere those shoes were old
With which she followed my poor father's body--------------------
-
Like Niobe, all tears; — why she, even she, —
O God! a beast that wants discourse of reason,
Would have mourn'd longer, — married with mine uncle,
My father's brother; but no more like my father
Than I to Hercules: within a month;
Ere yet the salt of most unrighteous tears
Had left the flushing in her galled eyes,
She married: — O, most wicked speed, to post
With such dexterity to incestuous sheets!
It is not, nor it cannot come to good;
But break my heart, — for I must hold my tongue!
2. Act I, scene v
Hamlet:
O all you host of heaven! O earth! what else?
And shall I couple hell? O, fie! — Hold, my heart;
And you, my sinews, grow not instant old,
But bear me stiffly up. — Remember thee!
Ay, thou poor ghost, while memory holds a seat
In this distracted globe. Remember thee!
Yea, from the table of my memory
I'll wipe away all trivial fond records,
15. All saws of books, all forms, all pressures past,
That youth and observation copied there;
And thy commandment all alone shall live
Within the book and volume of my brain,
Unmix'd with baser matter: yes, by heaven! —
O most pernicious woman!
O villain, villain, smiling, damned villain!
My tables, — meet it is I set it down,
That one may smile, and smile, and be a villain;
At least, I am sure, it may be so in Denmark
So, uncle, there you are. Now to my word.
3. Act II, scene ii
Hamlet:
Now I am alone.
O, what a rogue and peasant slave am I!
Is it not monstrous that this player here,
But in a fiction, in a dream of passion,
Could force his soul so to his own conceit
That from her working all his visage wan'd;
Tears in his eyes, distraction in's aspect,
A broken voice, and his whole function suiting
With forms to his conceit? And all for nothing!
For Hecuba?
What's Hecuba to him, or he to Hecuba,
16. That he should weep for her? What would he do,
Had he the motive and the cue for passion
That I have? He would drown the stage with tears
And cleave the general ear with horrid speech;
Make mad the guilty, and appal the free;
Confound the ignorant, and amaze, indeed,
The very faculties of eyes and ears.
Yet I,
A dull and muddy-mettled rascal, peak,
Like John-a-dreams, unpregnant of my cause,
And can say nothing; no, not for a king
Upon whose property and most dear life
A damn'd defeat was made. Am I a coward?
Who calls me villain? breaks my pate across?
Plucks off my beard and blows it in my face?
Tweaks me by the nose? gives me the lie i' the throat
As deep as to the lungs? who does me this, ha?
'Swounds, I should take it: for it cannot be
But I am pigeon-liver'd, and lack gall
To make oppression bitter; or ere this
I should have fatted all the region kites
With this slave's offal: bloody, bawdy villain!
Remorseless, treacherous, lecherous, kindless villain!
O, vengeance!
Why, what an ass am I! This is most brave,
That I, the son of a dear father murder'd,
Prompted to my revenge by heaven and hell,
Must, like a whore, unpack my heart with words
And fall a-cursing like a very drab,
A scullion!
Fie upon't! foh! — About, my brain! I have heard
That guilty creatures, sitting at a play,
Have by the very cunning of the scene
Been struck so to the soul that presently
They have proclaim'd their malefactions;
For murder, though it have no tongue, will speak
17. With most miraculous organ, I'll have these players
Play something like the murder of my father
Before mine uncle: I'll observe his looks;
I'll tent him to the quick: if he but blench,
I know my course. The spirit that I have seen
May be the devil: and the devil hath power
To assume a pleasing shape; yea, and perhaps
Out of my weakness and my melancholy, —
As he is very potent with such spirits, —
Abuses me to damn me: I'll have grounds
More relative than this. — the play's the thing
Wherein I'll catch the conscience of the king.
4. Act III, scene i
Hamlet:
To be, or not to be: that is the question:
Whether 'tis nobler in the mind to suffer
The slings and arrows of outrageous fortune,
18. Or to take arms against a sea of troubles,
And by opposing end them? To die: to sleep;
No more; and by a sleep to say we end
The heart-ache and the thousand natural shocks
That flesh is heir to, 'tis a consummation
Devoutly to be wish'd. To die, to sleep;
To sleep: perchance to dream: ay, there's the rub;
For in that sleep of death what dreams may come
When we have shuffled off this mortal coil,
Must give us pause: there's the respect
That makes calamity of so long life;
For who would bear the whips and scorns of time,
The oppressor's wrong, the proud man's contumely,
The pangs of despised love, the law's delay,
The insolence of office and the spurns
That patient merit of the unworthy takes,
When he himself might his quietus make
With a bare bodkin? who would fardels bear,
To grunt and sweat under a weary life,
But that the dread of something after death,
The undiscover'd country from whose bourn
No traveller returns, puzzles the will
And makes us rather bear those ills we have
Than fly to others that we know not of?
Thus conscience does make cowards of us all;
And thus the native hue of resolution
Is sicklied o'er with the pale cast of thought,
And enterprises of great pith and moment
With this regard their currents turn awry,
And lose the name of action. - Soft you now!
The fair Ophelia! Nymph, in thy orisons
Be all my sins remember'd.
5. Act III, scene ii
19. Hamlet:
'Tis now the very witching time of night,
When churchyards yawn, and hell itself breathes out
Contagion to this world: now could I drink hot blood,
And do such bitter business as the day
Would quake to look on. Soft! now to my mother. —
O heart, lose not thy nature; let not ever
The soul of Nero enter this firm bosom:
Let me be cruel, not unnatural;
I will speak daggers to her, but use none;
My tongue and soul in this be hypocrites, —
How in my words somever she be shent,
To give them seals never, my soul, consent!
6. Act III, scene iii
Claudius:
O, my offence is rank it smells to heaven;
It hath the primal eldest curse upon't,
A brother's murder. Pray can I not,
Though inclination be as sharp as will:
My stronger guilt defeats my strong intent;
20. And, like a man to double business bound,
I stand in pause where I shall first begin,
And both neglect. What if this cursed hand
Were thicker than itself with brother's blood,
Is there not rain enough in the sweet heavens
To wash it white as snow? Whereto serves mercy
But to confront the visage of offence?
And what's in prayer but this two-fold force,
To be forestalled ere we come to fall,
Or pardon'd being down? Then I'll look up;
My fault is past. But, O, what form of prayer
Can serve my turn? 'Forgive me my foul murder'?
That cannot be; since I am still possess'd
Of those effects for which I did the murder,
My crown, mine own ambition and my queen.
May one be pardon'd and retain the offence?
21. 7. Act III, scene iii
Hamlet:
Now might I do it pat now he is praying,
And now I'll do it, and so he goes to heaven.
And so am I revenged, that would be scanned.
A villain kills my father; and for that,
I, his sole son, do this same villain send to heaven.
O, this is hire and salary, not revenge.
He took my father grossly, full of bread -
With all his crimes broad blown, as flush as May.
And how his audit stands, who knows save heaven?
But in our circumstance and course of thought,
'Tis heavy with him, and am I, then, revenged;
To take him in the purging of his soul,
When he is fit and seasoned for his passage?
No.
Up, sword, and know thou a more horrid hent:
When he is drunk asleep or in his rage;
Or in the incestuous pleasure of his bed;
At gaming, swearing or about some act
That has no relish of salvation in it.
Then trip him, that his heels may kick at heaven,
And that his soul may be as damned and black
As hell, whereto it goes. My mother stays,
This physic but prolongs thy sickly days.
22. 8. Act IV, scene iv
Hamlet:
How all occasions do inform against me
And spur my dull revenge! What is a man
If his chief good and market of his time
Be but to sleep and feed? a beast, no more.
Sure he that made us with such large discourse,
Looking before and after, gave us not
That capability and godlike reason
To fust in us unused. Now, whether it be
Bestial oblivion, or some craven scruple
Of thinking too precisely on the event,
A thought which, quartered, hath but one part wisdom
And ever three parts coward; I do not know
Why yet I live to say 'This thing's to do'
Sith I have cause, and will, and strength, and means
To do it. Examples, gross as earth, exhort me:
Witness this army, of such mass and charge,
Led by a delicate and tender prince.
Whose spirit, with divine ambition puffed,
Makes mouths at the invisible event.
Exposing what is mortal and unsure
To all that fortune, death, and danger dare,
Even for an egg-shell. Rightly to be great
Is not to stir without great argument,
23. But greatly to find quarrel in a straw
When honour's at the stake. How stand I, then,
That have a father killed, a mother stained,
Excitements of my reason and my blood,
And let all sleep? While, to my shame, I see
The imminent death of twenty thousand men
That, for a fantasy and trick of fame,
Go to their graves like beds — fight for a plot
Whereon the numbers cannot try the cause,
Which is not tomb enough and continent
To hide the slain? O, from this time forth,
My thoughts be bloody, or be nothing worth!
STOCK INVESTMENT
PAGE 7
Stock Investment rev
Name:
Tutor:
Running Head: STOCK INVESTMENT
Date:
Stock Investment Evaluation
Abstract
The analyses undertaken in the paper evaluates the
potential of the three stock investments in generating capital
gains for an investor. The assessment on the viability of the
three stocks has been undertaken by considering the present
value of the stocks compared to the prevailing prices of the
24. stocks at the capital market. In addition, the risk factor of the
three stocks has evaluated in determining if the stocks are
unlikely to generate the returns they promise an investor.
Accordingly, the analyses reveal the three stocks current price
in the market is above the intrinsic value. Thus, the price of the
stocks is likely to decline in the future that will cause capital
losses to an investor. Similarly, the riskiness of the stocks has
been established to be high due to the high volatility of the
stocks’ price. Consequently, the recommendation given is that a
rational investor should not consider selling the here socks
currently.
Introduction
Stock investment in the modern environment of capitalism
has become one of the prominent investments that investors are
undertaking. The equity or stock investment has become a
popular investment due to the high investment return it
promises the investors in the future. However, the extent of
determining if a stock investment is able to generate returns for
an investor is determined by its present valuation and risk
factor. The present valuation is vital because it determines if a
stock is undervalued or overvalued under the prevailing stock
market price. Similarly, the risk factor is vital because it
measures the possibility of the stock return in failing to
generate the returns it promises to the investor. Consequently,
the paper examines the ability of the Verizon, Motorola, and
AT&T stocks in maximizing the wealth of an investor.
Literature Review
The valuation of stocks is one of the intensive studies that have
been undertaken in determining if a given stock is undervalued
or overvalued when compared to the current trading price. The
ability to determine if a given stock is undervalued or
overvalued enables an investor in determining if the stock has
the potential of generating capital gains in the future (Reilly &
Brown, 2012). Consequently, the capital asset pricing model
(CAPM) is one of the valuation methods that are employed in
25. determining the present value of a stock. The rationale behind
the CAPM approach is relating the expected return and risk of
the stock in assessing if the price of the stock is above or below
the market price prevailing (Hackel, 2011). Accordingly, the
formula that is employed in determining the present value of a
stock using the CAPM method is illustrated below.
Ra = rf + Beta*(rm – rf) (Damodaran, 2012)
Where rf is the risk free rate and rm is the expected market
return.
CAPM approach of determining the present value of a stock is
derived the rationale that investors demands to be compensated
in two ways on their capital investment of risk premium and
time value of money. The risk free rate in the CAPM model is
used to in representing the time value of money that an investor
employs in investing in the given stock investment (Damodaran,
2012). In Contrast, , the beta value is used to measure the risk
of the given stock investment by comparing the returns of the
stock to the expected return of a market.
Gordon growth model is another vital approach that is
employed in determining the present value of a stock. The
Gordon growth model determines the intrinsic value of a stock
using the future expected dividend series of the stock. The
Gordon discount assumes that the future cash flows or dividends
of the stock will continue growing constantly (Damodaran,
2012). Accordingly, the approach that is employed in deriving
the present value of a stock using the Gordon discount method
is demonstrated below.
Po = Div1/ r – g
Where Po is the stock price, Div1 is the forecasted dividend of
the stock in coming period, r is required rate of return, and g is
the growth rate (Damodaran, 2012).
The concept employed under the Gordon growth model indicates
that the company’s stock been valuated need to have a high cash
inflow and stable leverage patterns. This is because the growth
rates of the dividends the investors expect in future have to be
stable. However, the limitation of the Gordon discount method
26. is that it can only be employed in determining the present value
of a stock whose company has a constantly growing dividend
issuance.
Risk analysis is another critical aspect that enables an
investor in determining if a stock investment is capable of
maximizing his/her wealth. Accordingly, some risk assessment
theories have been developed in helping an investor undertaking
stock investment if it is able to generate returns in the future.
The various approaches that are employed in assessing the risk
extent of a given stock investment include Sharpe ratio, beta,
alpha, and r-regression. The Sharpe ratio involves evaluating
the risk-adjusted return of a given stock. A Sharpe ratio is
necessary in demonstrating to a shareholder if the returns of a
stock investment return are motivated by high additional risk.
Consequently, the formula that is employed in determining the
Sharpe’s ratio is reflected below.
Sharpe ratio = (mean return – risk-free rate)/ standard deviation
R-squared regression measure of a stock risk measures the
trend of a security’s return compared to the benchmark index.
The benchmark index that has been employed in determining the
R-squared ratio of the three stocks is the S&P 500 index.
Accordingly, the R-squared ratio of a stock in relation to the
market benchmark is evaluated using the rationale given in the
table below.
Percentage
Correlation
70-100%
good correlation between the portfolio's returns and the
benchmark's returns
40-70%
average correlation between the portfolio's returns and the
benchmark's returns
1-40%
low correlation between the portfolio's returns and the
benchmark's returns
27. Source (MorningStar, 2015).
Similarly, standard deviation is another variable that is
employed in determining the risk factor of a given stock. The
standard deviation determines the riskiness of a stock
investment by measuring the potential of the stock return in the
future failing to give expected return. The extent of the standard
deviation in reflecting the possibility of a stock in failing to
generate the expected return is vital in enabling an investor in
determining if the stock is a prudent capital investment.
Consequently, the various risk assessment approaches are vital
in determining if a given stock investment is risky for an
investor.
Data
The data employed in determining if the three stocks are
able to enhance the wealth of the investor are demonstrated
below.
Stock
Intrinsic value
Verizon
$18.52
Motorola
$8.33
AT&T
$7.59
In contrast, the market price of the three stocks in the market
currently is as reflected in the table below.
Stock
Intrinsic value
Verizon
$$49.2
Motorola
$61.61
AT&T
$32.75
28. Methodology
The approach that has been employed in deriving historical
data of the given stocks is the use of the online platforms. The
historical data has been derived from the financial publications
listing the historical prices and dividend payouts.
Findings
The computations undertaken in the attached spreadsheet
demonstrates that the three stocks are overvalued compared to
the intrinsic stock value. The overvaluation of the stock value
implies the current price of the stocks is likely to fall in the
future. If the price of the stocks falls in the future, an investor
will suffer huge capital loss. Thus, a rational investor should
consider selling the stocks at the current price to avoid
incurring huge financial loss in the future.
Conclusion and Recommendation
Portfolio management approaches are vital in enabling an
investor to make an informed capital investment decision. The
portfolio analysis of the three stocks demonstrates the potential
of the three stocks in generating capital gains or losses.
Accordingly, the analyses undertaken demonstrate the three
stock investments will generate capital loss in the future. The
overvaluation of the stocks demonstrates that an investor is
likely to face price declines in the future that will cause capital
loss. Similarly, the bet value of the stocks demonstrates the
three stocks are quite volatile on price movements.
Consequently, it is recommended a rational investor should
consider selling the stocks to avoid suffering capital loss in the
future.
References
Damodaran, A. (2012). Investment valuation: Tools and
techniques for determining the value of any asset. (Investment
valuation.) . Hoboken, N.J: Wiley.
Hackel, K. S. (2011). Security valuation and risk analysis:
Assessing value in investment decision making. New York:
29. McGraw-Hill.
MorningStar. (2015). R-squared. Retrieved 2015, from
http://www.morningstar.com/InvGlossary/r_squared_definition_
what_is.aspx
Reilly, F. K., & Brown, K. C. (2012). Investment analysis and
portfolio management. Mason, Ohio: South-Western Cengage
Learning.
VerizonDateVerizonSP500Verizon Returns SP
returnsDateDividends12/1/1446.782058.9-0.0753113263-
0.004188512110/8/140.550.5511/3/1450.592067.560.006766169
20.02453358447/8/140.53Market
Price49.2g1%10/1/1450.252018.050.00520104020.02320145624
/8/140.53Beta0.369/2/1449.991972.290.0034122842-
0.01551385911/8/140.538/1/1449.822003.37-
0.01190003970.037655321710/8/130.53rs=rf+Beta(7%)4%7/1/1
450.421930.670.0304516656-
0.01507986317/8/130.5156/2/1448.931960.23-
0.02061649320.01905831344/8/130.515P0=D0(1+g)/rs-
g18.51666666675/1/1449.961923.570.06912047930.0210302821
1/8/130.5154/1/1446.731883.95-
0.01765818790.006200796910/5/120.515Beta smaller than one
less risky3/3/1447.571872.34-
0.00021017230.00693215747/6/120.52/3/1447.581859.45-
0.00916284880.04311703764/5/120.5SUMMARY
OUTPUT1/2/1448.021782.59-0.0227920228-
0.03558289511/6/120.512/2/1349.141848.36-
0.00967351870.023562833310/5/110.5Regression
Statistics11/1/1349.621805.81-
0.01762027320.02804946097/6/110.488Multiple
R0.42554206910/1/1350.511756.540.08227983720.0445957599
4/6/110.488R Square0.18108605259/3/1346.671681.55-
0.01498522580.02974947491/6/110.488Adjusted R
Square0.1740867888/1/1347.381632.97-0.0424413905-
0.031298013310/6/100.488Standard