2. Prefer
• Include five different stocks from U.S
• Each have different invested amount
• Portfolio is monitored, evaluated and estimated on period
of 12 weeks (September 3rd – November 20th, 2013)
• The portfolio is a medium to high-risk appetite
3. Investment Objective
• Achieve short-term profit with $1,000,000 account
balance
• Expected profit for portfolio is approximate 10% of
$1,000,000.
4. Strategies
• Chosen Industries: technology, business services, steel
& iron, copper and health care
• Chosen Stocks: Apple Inc. (AAPL), Steel Dynamics
Inc. (STLD), Global Payments Inc. (GPN), Freeport-
McMoRan Copper & Gold Inc. (FCX) and Rite Aid
Corporation (RAD)
• Mixing of top-down and bottom-up approach
• Using the top-down approach to identify key macroeconomic->
identify stocks’ benefit from the same sector
• Applying the bottom-up approach based on individual
companies provide attractive investment opportunities in
various industry and market conditions.
5. Strategies (cont.)
• Three high-risk stocks and
two low-risk are chosen->
keep the portfolio balance
• Two stocks have betas lower
than 1 (market’s beta), and
three other stocks have betas
higher than 1
• The riskier high-beta stocks
are, the higher returns
• The less risk low-beta stocks,
the lower returns
• The expectation of this
portfolio is gain 10% in 12-
week period
Company
Ticker
Symbol Industry Shares Beta
Apple Inc. AAPL Technology 400 0.35
Steel Dynamics
Inc STLD Steel & Iron 13,100 1.41
Global Payments
Inc. GPN
Business
Services 4,200 0.79
Freeport-
McMoRanCopper
& Gold Inc. FCX Copper 6,400 1.32
Rite Aid
Corporation RAD Health Care 30,000 1.71
6. Decision
• STLD and FCX are affected by gold price, which is
recently in the good shape – stocks’ prices will increase
• AAPL – many new products in September and October
• GPN – electronic payments transaction processing
services worldwide – large market – big income.
• RAD – new change in Obamacare
Company
Ticker
Symbol Industry Shares
Beginning
Price
Total
transaction
amount Market Weight
Apple Inc. AAPL Technology 400 $ 488.58 $ 195,432 21.69%
Steel Dynamics Inc STLD Steel & Iron 13,100 $ 15.22 $ 199,382 22.13%
Global Payments Inc. GPN Business Services 4,200 $ 47.85 $ 200,970 22.30%
Freeport-McMoRanCopper & Gold Inc. FCX Copper 6,400 $ 31.12 $ 199,168 22.10%
Rite Aid Corporation RAD Health Care 30,000 $ 3.54 $ 106,200 11.78%
$ 901,152 100.00%
7. Portfolio Performance ( Profit/Loss)
• The Beta is important to measure of stock’s volatility in
relation to the market.
• AAPL underperformed comparing to the market because
the actual increase is less
• STLD, GPN, FCX and RAD outperformed the market
S & P 500
DATES
CHANGE IN PRICE %
% x β β9/3/2013 11/20/2013
1,639.77 1,781.37 141.60 9%
AAPL 488.58 515.00 26.42 5% 2% 0.35
STLD 15.22 18.93 3.71 24% 34% 1.41
GPN 47.85 62.81 14.96 31% 25% 0.79
FCX 31.12 36.18 5.06 16% 21% 1.32
RAD 3.54 5.10 1.56 44% 75% 1.71
8. Reasons of the changes
• New products, new investment, or any movement in the
management strategies or acquisitions-> stock prices
change
• Also have some specific reasons regarding possible
changes in the stocks’ prices
9. Apple, Inc. (AAPL)
• AAPL announced new products in 2013 such as iPhone
5S, iPhone 5C, iPad Air, iPad mini Retina, Mac Pro,
MacBook Pro, iOS5 and OS X 10.9 Mavericks
• Given dividends $3.05
• Put on “NEUTRAL” rating
• Small gains
Arithmetic 0.117%
Geometric 0.103%
Standard Deviation 1.620335
Avg Excess Return -2.57327
Beta 0.35
Coefficient of Variation 1085.478
HPR 0.991242
HPY -0.876%
10. Steel Dynamics, Inc. (STLD)
• Announcing two notes in operating:
• Offering up to $400,000,000 aggregate principal amount of its
registered 6 1/8% senior notes due in 2019
• Offering up to $350,000,000 aggregate principal amount of its
registered 6 3/8% senior notes due in 2022
• Dividends $0.11
• Preventing from “BUY’ to “NEUTRAL”
Arithmetic 0.411%
Geometric 0.395%
Standard Deviation 1.356826
Avg Excess Return -2.27907
Beta 0.35
Coefficient of Variation 283.0919
HPR 0.994223
HPY -0.578%
11. Global Payments, Inc. (GPN)
• First quarter profit increased to 87 cents/share from 59
cents/share
• Announce an accelerated $100 million stock buyback plan
• The effect of changing in management, new chief
executive-> share of GPN up almost 4%
• Put GPN on “HOLD” and wait for price increasing more
Arithmetic 0.503%
Geometric 0.479%
Standard Deviation 1.808762272
Avg Excess Return -2.187839025
Beta 0.35
Coefficient of Variation 267.5375346
HPR 0.990381583
HPY -0.962%
12. Freeport-McMoRan Copper & Gold, Inc.
(FCX)
• Return on equity is respectable
• The exploration of mineral resource
• Limits:
• feeble growth in the earnings per share
• deteriorating net income
• higher debt management risk.
• Decide to rate as a “HOLD”
Arithmetic 0.295%
Geometric 0.281%
Standard Deviation 1.347124
Avg Excess Return -2.39555
Beta 0.35
Coefficient of Variation 393.4673
HPR -0.0095
HPY 9.744%
13. Rite Aid Corporation (RAD)
• Based on Jim Cramer, stock analyst on Wall St. Cheat
Sheet, reported on August 29, 2013
• Have upward movement in the stock’s value.
• Decide to rank it as “BUY”
Arithmetric 0.713%
Geometric 0.643%
Standard Deviation 3.628434
Avg Excess Return -1.97763
Beta 0.35
Coefficient of Variation 267.1958
HPR 1.005917
HPY 0.592%
14. • The following graphs show the correlation between stocks
inside portfolio and the overall performance of the
portfolio during 12 weeks of investment.
15. Conclusion
• Good diversified portfolio
• Different industries
• Not correlated
• Profit of $204,997.00
800,000
850,000
900,000
950,000
1,000,000
1,050,000
1,100,000
1,150,000
1,200,000
1,250,000
9/3/2013 10/3/2013 11/3/2013
Investment Performance
Series3
Total Value
