My initial research
When you buy a stock (or share) of a company, you’re buying a part of it. The goal is to buy stocks in companies that you think will do well to make money. Many people decide to buy several stocks in different sectors and keep them for a long time because they’re more likely to make money that way instead of investing in a single stock and risking to lose lots of money.
A "stock" is the general term used to describe the ownership of any company in general, while a "share" is the term used to describe the ownership of a particular company.
Some companies also pay their shareholders a cut of their profit - the dividend. Investors who would like regular income from their investments usually buy stocks that pay high dividends.
Each company uses a ticker symbol, which is an abbreviation used to identify publicly traded shares of a particular stock on a particular stock market.
Supply and demand affects the stock market by determining the prices of the stocks that make up the market. Supply represents how much of the product or service the market can offer, and demand represents how much of the product or service the buyers want.
There are pros and cons of investing in the stock market. For example, you can earn income from the dividends, and there’s a growth potential for long-term investments, but there’s the risk of another banking crisis. Investing in a stock market is never risk free.
My mid-October reflection
I originally chose to buy shares of Adidas, Amazon and Vestas Wind Systems, also buying from Facebook and UPS. I then bought shares from Thor Industries, Tyson Foods inc. and Spectrum Brand Holdings. In the beginning of October, I sold my shares from Tyson Food inc. because the profit was dropping and I was losing money. In mid-October, I sold my shares from Vestas Wind Systems, Thor Industries and Spectrum Brand Holdings for the same reasons.
The best companies in my portfolio are currently Adidas and Amazon because they’ve been constantly gaining money, although Amazon’s shares have started to drop.
If I redid this project, I would probably be more careful when I choose companies. I think I would keep the stocks I currently own (Adidas, Amazon, Facebook and UPS) but I wouldn’t buy shares from too many different companies, only a few (3-4). I would also make sure to do more research on each company before buying shares.
My final reflection
The best company I had in my portfolio was UPS. Although it wasn’t doing very well in September and October, it’s profits went up a lot at the beginning of November.
I think that the worst companies I had were Spectrum Brands Holding and Alphabet Inc. because they were very unpredictable compared to my other stocks. When I looked at their line graphs, the lines kept going up, then suddenly dropping a lot. However, I didn’t own shares of those companies during the entire project. I sold Spectrum Brands Holding in mid-October, so I didn’t lose any money when it dropped in November. I bought Google soon after that, meaning that I did lose money when their profits dropped.
Nearly all of my stocks were american. Most of them dropped abruptly in beginning of November because of the elections, with the exceptions of UPS, where the profits increased a lot instead of decreasing, and Logitech, which I bought late in November.
Adidas, however, is a european stock. It was doing well at the start of the school year, probably because students needed to buy sports gear for P.E. or sports seasons. Nevertheless, the profits also decreased in November, something I don’t know how to explain.
If I had to redo this project, I would be more careful when choosing companies to invest in and analyse the data for each company instead of rushing. I wouldn’t invest in too many different stocks, only choosing a few. I would also try to stay aware of any big events that could make my stock’s profits increase or decrease (for example : the elections, Brexit, etc) and invest in stocks from different equities (U.S., european, asian, etc).
I’ve learned that investing in the stock market is a lot harder than it seems. You have to be very careful when choosing companies to invest in, but you’re always taking risks, since you don’t know if those stocks will do well or not. I also learned that the stock market is affected by big events such as the elections and that it’s better to sell your stocks before the event happens and start over after the event has passed.