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Stock Market Project!

How do stock brokers and financial analysts determine what stocks to buy? What do they investigate when looking at a company?

As you work through the activities, you will collect data about a company. You will use formulas to analyze the data. Then you will decide how to organize and display your results in graphs and spreadsheets. The activities will help you better understand how stockbrokers and financial analysts track stock performance to determine what stocks to buy.

Activities

Activity 1: Researching

Before making any decisions regarding a stock purchase, it is customary to obtain facts and a history about a company.

• Select a company to research (it must be a publically exchanged company). Gather information about the products or services the company sells, the history of the company, its management practices, and its revenue and profits.

• What is the stock symbol and on which market is it traded?

• Investigate the requirements for a company to trade on the New York Stock Exchange.

OUTCOMES:

✓ Title page with stock symbol and company name

✓ Essay about company research (IN YOUR OWN WORDS) – must have information on products or services, history, management style or revenue and profits. (A three paragraph essay word work nicely.)

✓ Logo for company and pictures of a few products (you may use them any way you desire, but they must be in the project SOMEWHERE)

✓ A short paragraph explaining how the NYSE works.

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Activity 2 Analyzing

Before you track a stock, you need to be familiar with the stock page of the newspaper.

• Using the attached worksheet with a stock page example- determine what the headings mean for each column.

• Look online and find a closing price for the stock you chose in activity 1.

• What was the highest price for that stock during the last year? Lowest?

OUTCOMES:

✓ Complete the handout with a section of the stock page; identify the meanings of each heading.

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Activity 3: Organizing

Ideally, before buying stock in a company, you study the historical performance of the stock in order to help predict its future potential. In this activity, you will track a stock’s performance during previous years.

• Using the company you selected in activity 1, create a spreadsheet that displays the high and low price for the year, and earnings per share. The information should be collected for the last 10 years.

• Include a column on the spreadsheet that determines the average of each row.

OUTCOMES:

✓ Spread sheet with appropriate titles and accurate mathematics

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Activity 4: Calculating

Suppose you have $10,000 to invest in the stock you have selected. The purchase price will include the price of the stock plus a $19.95 service fee.

• How many shares of the stock can you buy?

• Keep track of your stock daily. Did the stock close higher or lower than the day before?

• Prepare a graph of the daily closing prices of your stock for the duration of the project. (bar or line graph)

• Write a few sentences to describe your predictions about this company from your graph. Is the company worth the “risk”?

• At the conclusion of the project, suppose you sell your stock. Did you make a profit or incur a loss? Explain.

OUTCOMES:

✓ Daily ledger of stock prices

✓ Graph of stock price changes (graphical representation of ledger)

✓ Paragraph explaining the movement of your stock prices – may include your feelings about your choice of company (would you choose the same company in the future?) EXPLAIN FULLY!

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Activity 5: History & Current Events

What’s been going on with the stock market since you were born? What’s been going on the past few months? Despite the recent lows, the stock market has the best return for long time investors. The risk in the stock market can be great, but the benefit may be worth the risk!

• Find out what the closing number was for the Dow Jones industrial average on the last day of each year since were born through 2008.

• Prepare a line graph to illustrate the highs and lows over your life.

• Find an article in the Wall Street Journal, FORBES magazine, or any other publication about a current financial topic. Summarize this article using your own words (be sure to include a copy of this article with the author, publication, and time it was published – lack of this is plagiarism).

OUTCOMES:

✓ Line graph with appropriate titles and labels

✓ Financial article and a summary of it

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Activity 6: VOCABULARY

Use the following vocabulary to create a unique way to display their definitions (i.e. graphic organizer, cross-word puzzle, art, etc)

• Stock Exchange

• Stock

• Bonds

• Products

• Shareholder

• Profits

• Share

• Rise

• Fall

• Price

• Invest

• FDIC

• Safety

• Liquidity

• Appreciation

• Risk

• Ownership

• Dividends

• Parent Company

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Activity 7: Exhibition Reflection

1. Write a narrative that includes two paragraphs.

a. Paragraph 1

i. What did you learn? (Any thing you learned while doing the project would be appropriate)

ii. What assisted you in learning these things?

iii. How will you use what you learned in the future?

iv. What subjects did you use to complete this project?

b. Paragraph 2

i. What was your favorite part of this project?

ii. What was your least favorite pat of this project?

iii. If you were to do this project again, what would you do differently?

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FINISHING THE PROJECT

The answers to the seven activities should help you complete your project. Assemble all the parts of your project in a clear report cover. Include a summary of what you have learned about the stock market. Is the stock you picked a good stock? Would you recommend this stock to others? Why did you choose your company; was it based on emotion or sound financial record? Explain.

Reflect and Revise

Ask a classmate to review your notebook with you. Together, check that your graph is clearly labeled and accurate. Is your spreadsheet well organized and easy to follow? Make any necessary revisions to improve your work. (Parents are also great PROOF-READERS!!)

Extra Credit (good size paragraph for each item)

1. Investigate the advantages of diversifying your stock portfolio. What do stockbrokers and financial analysts recommend in regards to purchasing a particular stock.

2. Research what it takes to become a stock broker or financial analyst. How long do you go to college? Where do you work, and how much does it pay? What subjects must you be good at to be successful?

3. Who started your company? What kind of background did he/she/they have? How long has the company been in business? Write a short biography about the company founder or founders.

Possible Resources:

Newspapers

The Commercial Appeal (E-Appeal)

The Wall Street Journal

USA Today

Websites





(finance)

Magazines

FORBES

Project Manager

“Taking Stock in the US Stock Market”

Getting Started

Read the project. As you work on the project, you will need a calculator, publications (newspaper and/or magazine), materials to make accurate and attractive graphs (Microsoft Excel), and the internet for research. Keep all of your work for the project in a folder. You will need a clear report cover for the final project.

CHECKLIST

← Title page with stock symbol, company name, and YOUR NAME!

← Essay about company research (IN YOUR OWN WORDS) – must have information on products or services, history, management style or revenue and profits. (A three paragraph essay word work nicely.)

← Logo for company and pictures of a few products (you may use them any way you desire, but they must be in the project SOMEWHERE)

← A paragraph explaining how the NYSE works.

← List of vocabulary terms with their definitions and/or examples

← A section of the stock page with the heading identified and explained.

← A spread sheet showing the highs and lows of your chosen stock for the past ten years with appropriate titles and accurate mathematics

← Daily ledger of stock prices

← Graph of stock price changes (graphical representation of ledger)

← Paragraph explaining the movement of your stock prices

← Line graph illustrating the yearly closing numbers for each of the years you were born with appropriate titles and labels

← A financial article and a summary of it

← Exhibition Reflection

← Extra Credit if you choose

← References

Rubric for STOCK MARKET PROJECT

15 points ….. Title page

60 points ….. All narratives are present, accurate, and grammatically correct.

• Essay – company research

• Paragraph – how does the stock market work?

• Paragraph – Explanation of your stock price changes with your own ideas of why it may have changed

10 points ….. Pictures relating to your company

30 points ….. Vocabulary

15 points ….. Stock page example with explanation

80 points ….. Graphs and Tables

• Spread sheet with past 10 years information

• Daily ledger of current stock prices

• Graph of price changes from your ledger

• Line graph showing the yearly closing numbers for every year since your birth

30 points ….. A financial article and its summary

30 points ….. Reflection

15 points ….. Neatness & Visually Appealing

15 points ….. Timely

300 points ….. Total Extra Credit (Up to 30 points)

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Timeline

1st check - Friday, November 9th

• Title page

• Essay on company

• Paragraph explaining stock market

2nd check - FRIDAY, November 16th

• Vocabulary activity with key

• Copy of stock page with headings identified

• Line graph illustrating year-end stock prices for your company since your birth

• Spreadsheet with high and lows of your company for the past ten years

3rd check – Tuesday, November 20th

• Financial article and your summary

• Daily ledger

• Graph of daily ledger results

• Paragraph explaining the movement of your stock for 10 days

DUE – FRIDAY, November 30th

• Reflection

• Extra credit

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Suggestions

• Look up information at the library or on the internet.

• Ask an adult for additional help interpreting the stock page.

• Gather all necessary information. Consider checking financial advisers’ websites. (Edward Jones, Merrill Lynch, etc)

• Recall that profit is the money remaining after expenses have been paid.

• Be careful with your materials – keep them separate from your math stuff in a safe place.

• You will be given multiple due dates – be sure to keep up!

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