Thursday, March 27, 2014

Our Philosophy

            As a group we have decided that we are going to make short-term investments, by buying cheap stocks and making a profit as soon as possible. Once we see that a certain stock has made a profit, we plan to sell it in order to avoid a risky drop in the stock at a later time. Our main plan of action is to “keep it safe”, and weigh the chances as much as possible to keep the statistics in our favor. We also do not plan on buying stocks that show a steady decrease in value because there is always a chance that they may continue to fall instead of increase in price. On the other hand, if we notice that a stock is increasing, we will invest in a certain number of those stocks. Ultimately, after a rise in the stock price, there will be an inevitable fall in price, which we can take advantage of by selling it at that moment, and making the largest net profit from that exchange. By the end of all the transactions after the 4 weeks, we intend to make a profit of $20,000, that we can use for our college tuition to further our education. 

        Most of our stocks are going to involve manufacturers that released new types of technology because stocks of that nature generally have a trend to increase since people are always investing money into the newest, evolved form of technology. Nonetheless, we will also be on a continuous lookout for other types of companies that have showed to be increasing in value. The Boston Company is one of the largest global investment management firms and it sees growing opportunities in security, big data, cloud based computing systems and social media technology. This company serves as an example as to why technology is sought after and expected to do well in the stock market, as we have predicted. 
We have already purchased stocks of several companies, adhering to our strategic plan of finding innovative technologies. One such company that is making technological strides is AT&T, because it has showed continuous expansion and coverage throughout the nation. Recently, it has introduced the HTC One® mobile phone with many new features, it has released an offer to several states such as Oklahoma and Arkansas to offer up to one year of free U-Verse high speed internet to small businesses, and it has expanded its 4G LTE network to new regions as part of its Project Velocity IP. It is one of the most well-known phone companies, so people are going to be willing to spend a portion of their money into a company that they think will do well, and has previously supplied the public with innovative technology. In addition to phones and data coverage, investments in biotechnology are safe to make as well. More specifically, the biotechnological company Amgen, delivers many health related products such as dialysis equipment, which finds high use in the medical field. Furthermore, it is working on extensive research to release new drugs which are expected to have many health benefits. Another company showing promising increases in stock value is Cisco Systems which manufactures and sells networking equipment. It has just released Cisco Aironet 2700 Series Access Point which is expected to help Local Area Network (LAN) to support mobile devices, apps, and data existent in high-density consumer areas. 

            Although we see many possible gains, one problem that our team noted right away was that the stocks, in The Stock Market Game, are only processed the day after a purchase is made. This may prove to be a major problem as there is no way of knowing for sure the prices of stocks the following day. If a stock is bought today and doing well, indicating an increase in value, the next day it might completely diminish in value and render huge losses. As a result, the game does not allow us to track the minute by minute progress of the stock immediately after its purchase. This adds much more risk, and decreases the amount of strategy that we have agreed upon. Another problem that can arise is that we might not earn enough of a profit due to the fact that we are “playing it safe". However, that can almost guarantee that we don’t lose the money that we were initially provided with.  

            Despite all the challenges and the unpredictability of the stock market, we look forward to making investments in different companies and earning a profit.