My initial research in the stock market:
Like many other things these days businesses turn to the internet instead of the streets, to use something called the stock market. This is a website where companies can sell stock which is the general term for someone owning part of a company or shares which is when a person owns a small part of a company. When an investor buys a share, they own a fraction of the company. To have a share in a company all you have to do is pay for it so you can just be anyone with a fraction of a big company. The fraction of the company that a person can own depends on how many shares they want to buy and the size of the shares, which can vary from company to company. When a person then buys a share in that company they can use the stock market to see how the company's stock is going. If the company that they invested in suddenly makes a huge profit then the investor also makes a profit but if the company suddenly goes down in value then the investor also loses money. That is why before an investor buys stock in a company then they always look at the value of the company and if it could go downhill very quickly or if they could make a profit.
When a person chooses to invest stock in a company they usually look at the company’s history to try and predict their future. The investor can choose to look at the recent days, weeks, months or years to help determine if it is a good investment. If it was a good investment then the company rise meaning they would earn more money and therefore they could choose to give yearly dividends to their shareholders (the investors). Even though the company would be giving away money than it would still be a good choice for them because it would make them more liked among the shareholders. Anyone who wants can invest in the stock market. That means that even if you barely have any money that you want to use but you still want to invest a little, then you can invest in a mutual fund. Mutual funds are when there is more than one person that wants a bit of different companies but doesn’t want to buy whole shares or can’t afford whole shares. Then, instead of investing in just one share they can invest part shares together with other people who want the same thing and then together they have a whole share. If the company then gets a profit the people that have the mutual fund together then split the money that they earn. But that way they can still invest in what they want to invest.
My 3 companies:
My 3 initial stocks that I invested in first were Tucows, an internet service, Novo Nordisk, a pharmaceutical company, and Netflix, an entertainment company. I decided to invest in these 3 companies because they are in 3 different branches, meaning that they are about totally different things. For an internet service I chose Tucows because it was cheap, which meant that it was new and I therefore saw potential in it, as in it might increase. Next I chose Novo Nordisk as a pharmaceutical company because I knew a lot about it, because my dad used to work there, but also because it had been very steady overtime and it was rising little by little. And for the 3rd one I chose Netflix because it was very popular so it was rising and even though it was well-known, then it wasn't too expensive.
My reflection half way through (stage 3b):
Right now in my portfolio I have stocks in 7 different companies. The company that is definitely doing the best is netflix having a percentage of 31.67%. And the company that is doing the worst by a lot is novavax incorporation with a -25.23%. Next starting at the highest is Bank of America, Amazon, Tobira Therapeutics, Google, Disney, Target and then Novo Nordisk. I think that some of the time I bought stocks in some of the companies a little too late so they were already at the top. And sometimes I took a little too many risks, but all in all the companies I had bought rose and fell like I had expected but hoped they wouldn’t. In the start of the projects I wasn’t very good at investing and I had definitely not tried this before, so I thought that whenever a company was doing bad that I should immediately sell it which was clearly a big mistake since I lost a lot of money. However I sold a few other companies a little later on because they were doing bad and it didn’t seem like they were gonna get better so I decided to sell them when they were a little higher so I wouldn’t lose as much money. I also bought a few companies because I was hearing that they had just fallen so I thought they would probably go up really soon, or that they were already doing really well so I bought them, hoping that they would do even better. But one of the biggest changes to my portfolio that I made was that one evening I was talking to my dad and I told him how bad I was doing, and he told me that since I was at the bottom, then I should invest all my money in a company because I really had to gain money and I wouldn’t do that by it just sitting in my account. I think one thing that I have to continue doing is not to buy too much at once or sell too much at once and to sell and buy at the right times so that I can remain high up in the ranking like now (3rd) and not 47th out of 47 like I did for a while.
My final reflection on how it went:
In this project that has been going on for a long time now many of my company's’ stock have been on a roller coaster. Right now the ones that are at their peak are Target and Bank of America whereas Novo Nordisk is doing really bad together with Novavax but I sold that one because I wouldn’t lose too much money and because there was no way it would go up. Over the course of the project the increases or decreases of the companies can be determined by the products they are selling or what the buyer is interested in. If it’s a low season for what they are selling then of course their value is going to drop but also if there is a new product that buyer would rather have then they become more interested in that. Of course it’s not always that. Sometimes the company has exactly what the buyers want and that is usually when you can see their peaking. But usually after a peak there comes a drop, but after time the company overcomes that drop and maybe has another peak.
If I were to redo this project then knowing what I know then I would have not sold and bought so much in the beginning because that really made me lose a lot of money. I would also have remembered to sell stock when they were really high, but in reality it’s hard to know when they are going to drop and when they are going to keep going up. I would probably have bought many of the same stocks but I would also have sold them at a different time when they were peaking. But on top of buying some of the same stocks again, then, I would also like to have invested in Apple mostly because I hadn’t thought of the new iPhone coming out and how that would make the company increase, but other then that, there aren’t any companies where I really said I wish I had bought that. What I have learned from the stock market is how everything is tied together. Even if a new car is starting to sell, that could mean a lot for the company’s stock, or if a new article is released criticizing something that could have a bad influence. Or even getting a new president could make the stock market change. Things that you wouldn’t think were relevant could actually be really relevant and change everything. From this project I probably wouldn’t want to help people invest in a stock for a living because I don’t see myself as an expert and I would be too scared to invest real money.
The graphs possible to see for each of my existing companies: