Virtual Stock Exchange Project

Module 2 SLP Assignment

• Make 3 stock purchases and provide information about the purchases

Please download the Module 2 SLP template. You will type your answer into this Excel workbook. When finished with the SLP assignment, please save the document with your last name and submit to the dropbox.

1. Purchase 4: Assume you are a very risk averse investor (you don’t like risk). Buy at least $10,000 worth of a company’s stock that is appropriate given your risk preference.
2. Purchase 5: Assume you are a very risk loving investor (you LOVE risk). Buy at least $10,000 worth of a company’s stock that is appropriate given your risk preference.
3. Purchase 6: Assume you are an investor willing to accept average market risk (the Beta of the stock should be around 1). Buy at least $10,000 worth of a company’s stock that is appropriate given your risk preference.

You are free to make additional purchases, but you only need to explain the reasoning behind your required purchases 4 through 6.

1. You will need to include the following information for each stock in this workbook:

Company NameTicker SymbolReason for BuyingCurrent PricePrevious Close Price52-week High52-week LowBetaMarket CapP/E Ratio

Assignment Preview:

For Purchase 4, as a very risk-averse investor, you might consider investing in a company that is a market leader with a strong track record of financial performance, stability, and steady dividends. A utility company such as a electric, gas or water supplier could be considered a low-risk option, as they tend to have steady, regulated revenues. As an example, you can consider a company like NextEra Energy, Inc. (NEE) which is one of the largest electric power companies in the United States. As of january 2021, it has a Beta of 0.19, a Market Cap of $84.6 billion, and a P/E ratio of 22.33

For Purchase 5, as a very risk-loving investor, you might consider investing in a company that is in a high-growth industry, such as technology or biotechnology, and may have higher volatility, but also higher potential returns. An example of such a company could be Amazon.com Inc. (AMZN) which is the world’s largest online retailer, and a leading provider of cloud computing services. As of january 2021 it has a beta of 1.49, a market cap of $1.6 trillion and P/E ratio of 105.65

For Purchase 6, as an investor willing to accept average market risk, you may consider investing in a company that has a beta of around 1, which indicates that the stock’s price will move with the overall market. A example of such a company could be Berkshire Hathaway Inc. (BRK.A), which is an American multinational conglomerate holding company, that operates through its subsidiaries engaged in diverse business activities. As of january 2021 it has a beta of 0.78, a market cap of $522.4 billion and P/E ratio of 27.17

It’s also worth noting that, these are just examples and past performance doesn’t guarantee future results. It’s always recommended to conduct thorough research and due diligence on any stock before making an investment.

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