Personal Investment Objectives and Financial Goals
According to … stocks suited for long term goals that help an individual to achieve financial independence. However, some stocks investment may be used to meet short term goals, such as trend trading. Before making any investment decision, it is prudent to consider the personal investment and financial goals. The setting, short term, mid-term and long-term financial goals are the right path toward becoming financially secure.
A financial goal is a target to aim for when making financial decisions. The financial goals can be divided into three categories; the short-term financial goals, the midterm financial goals and the long-term financial goals. In our case, then we are going to concentrate on the long-term financial goals that take more than ten years to achieve.
Moreover, before investing, it is crucial to consider the personal investment objectives. According to …. There are three investment objectives for any investors, depending on the life stage and risk appetite of the investor. The objectives include safety, growth and income. When an investor is risk-averse, they may opt for safety investment, when an investor wishes to receive capital gains they have growth objective and financially some other investor may opt for income-generating investment that earn them income at regular bases.
After carrying out individual analysis, my investment objective is growth capital invested. The most preferred investment option includes stocks, mutual funds, gold, and bonds. However, the invested assets should have specific characteristics; the growth stocks are usually expensive, the stock does not regularly pay the dividends, the stocks have the tendency of higher share appreciation compared to other stocks, and the company have potential to earn higher profits in the future. Don't use plagiarised sources.Get your custom essay just from $11/page
Categories of Stocks
There are two categories of stocks, the common shares, the preferred. The common stock is capital security that represents ownership in a corporation. The ordinary shareholders have the right to vote in the annual general election or any other meeting. However, the common shareholders are last to receive their investment in case of company liquidation after bond preferred and other debtholders are paid in full. On the other hand, the preferred stocks have a higher claim to distribute dividends or assets distribution than the common stockholders. The preferred shareholders have no voting right to the company matters only the priority over common shareholders when it comes to dividends.
Since our investment objective is to grow our capital, we are going to invest in common stocks that have a higher chance of capital appreciation.
Company Profile
The $10,000 was invested in five stocks listed in both the NYSE and NASDAQ. Moreover, the companies are among the S&P 500 index. The stock includes; Pfizer Inc., (NYSE: PFE), Under Armour Inc. (NYSE: UA), Ford Motors Inc. (NYSE: F) Freeport McMorran Inc. (NYSE: FCX) and Mylan N.V (MYL). The companies are drawn from different industries for diversification; however, the stocks been described by several analysts to appreciate at a price in future. The shares were selected since they are undervalued, and they meet our budget constraints.
Pfizer Inc. (NYSE: PFE), is a pharmaceutical company that specializes in selling health care products around the world. The company specialize in vaccine and oncology medication. It was founded in 1849, and its headquarter are located in New York. Under Armour Inc. (NYSE: UA), is a sports apparel company that specializes in footwear for men and women in sport. The company was founded in 1996 and is headquartered in Baltimore, Maryland. Ford Motor Company is one of the leading car manufacturing and selling companies in North America. The company manufacture a range of cars, trucks, sport utility vehicles. The company was founded in 1903 and is based in Dearborn, Michigan.
Freeport McMorran Inc. (NYSE: FCX) is a mining company that specializes in exploring and extracting copper-gold and molybdenum mineral in North and South America. The company was founded in 1987 and is headquartered in Phoenix, Arizona. Mylan N.V (MYL). Is a pharmaceutical company that specializes in drugs that reduce the effect of HIV/AIDS. The company also provides prescription products such as Perforomist and Dymist solution. It was founded in 1961, and its headquarter are located in Hatfield’s the United Kingdom.
Tracking Spreadsheet
| Date | PFE | HPR | UA | HPR | F | HPR | FCX | HPR | MYL | HPR |
| 16-12-19 | 39.14 | 18.59 | 9.39 | 12.95 | 19.03 | |||||
| 17-12-19 | 35.90 | -0.61% | 16.69 | 0.54% | 9.39 | 0.00% | 12.96 | 0.08% | 18.83 | -1.05% |
| 18-12-19 | 38.89 | -0.64% | 19.03 | 2.37% | 9.54 | 1.60% | 12.98 | 0.23% | 18.87 | -0.84% |
| 19-12-19 | 38.97 | -0.43% | 19.01 | 2.26% | 9.41 | 0.21% | 13 | 0.39% | 19.38 | 1.84% |
| 20-12-19 | 39.23 | 0.23% | 19.3 | 3.82% | 9.48 | 0.96% | 12.71 | -1.85% | 19.79 | 3.99% |
| 23-12-19 | 39.32 | 0.46% | 19.37 | 4.20% | 9.44 | 0.53% | 12.85 | -0.77% | 19.92 | 4.68% |
| 24-12-19 | 39.29 | 0.38% | 19.4 | 4.36% | 9.47 | 0.85% | 12.99 | 0.31% | 19.84 | 4.26% |
| 26-12-19 | 39.38 | 0.61% | 19.55 | 5.16% | 9.45 | 0.64% | 13.17 | 1.70% | 19.58 | 2.89% |
| 27-12-19 | 39.32 | 0.46% | 19.25 | 3.55% | 9.36 | -0.32% | 13.03 | 0.62% | 19.72 | 3.63% |
| 30-12-19 | 38.91 | -0.59% | 18.99 | 2.15% | 9.25 | -1.49% | 13.01 | 0.46% | 19.43 | 2.10% |
| 31-12-19 | 39.18 | 0.10% | 19.18 | 3.17% | 9.3 | -0.96% | 13.12 | 1.31% | 20.1 | 5.62% |
| 02-01-20 | 39.14 | 0.00% | 19.24 | 3.50% | 9.42 | 0.32% | 13.2 | 1.93% | 20.65 | 8.51% |
| 03-01-20 | 38.93 | -0.54% | 19.27 | 3.66% | 9.21 | -1.92% | 12.8 | -1.16% | 20.2 | 6.15% |
The $10,000 was utilized as follows; $3590 for 100 shares of Pfizer Inc. (NYSE: PFE), $1669 for 100 shares of Under Armour Inc. (NYSE: UA), $939 for 100 shares for Ford Motors Inc. (NYSE: F), $1296 for 100 shares for Freeport McMorran Inc. (NYSE: FCX) and $1883 for 100 shares for Mylan N.V (MYL). The remainder ($623) was used as commission and transactions fees.
On January 03, 2020, the value of the portfolio was $10,041, representing 0.41% in two weeks. If the investment is given time, say ten years the rate is expected to be higher than 0.41% earned in two weeks. The Mylan N. V (MYL). Was the most improved stock with Holding Period Return of 6.15% for two weeks while Freeport McMorran Inc. (NYSE: FCX) was most underperforming stock with -1.16% holding period return. Compared to other companies in the S&P 500, our portfolio was outperforming since the average Holding return for the S&P 500 for the two weeks was 0.76%.
The growth of The Mylan N. V (MYL). The stock price was attributed to winning of the court case of investors of class actions on behalf of a shareholder of Unit and MYL and GRUB. Contrary to the downward trend of Freeport McMorran Inc. (NYSE: FCX) was a result of a loss that was made in Q4. The company press release indicates that 2019 was the toughest year for company operations.
Conclusion
After holding the portfolio for two weeks, I have proof that the stocks are likely to perform better in 2020 due to their high potential. However, the stock should be an investment in different companies to reduce the risk associated with some industries.