Common stocks are desirable for this purpose because their dividends tend to increase over time.
Safety of principal and stability of income are important in this strategy.
Quality income shares are a good choice for this strategy.
Some investors use it as a way of earning high returns on their investment capital.
The current-income strategy is often used by people trying to supplement their income.
Many of these investors plan to use the added income to supplement their retirement benefits.
Capital gains are the primary source of return in this strategy, which is less conservative than the first two.
A fair amount of trading takes place with this approach.
Some of the better tech stocks, as well as baby blues and other mid-caps, are the focus of most of the trading.
I appreciate common stoCks appreciation.
Although a number of growth stocks pay dividends, this strategy emphasizes capital gains as the main way to earn big returns.
This approach has a heavy reliance on capital gains.
Diversification is often used.
The most common reason for using this approach is long-term capital growth, but the investor tries to get a bigger payoff by doing more trading and assuming more market risk.
The total-return approach is used to invest.
This approach considers dividends as a source of return even though it is anchored in long-term growth.
The total-return approach seeks attractive long-term returns from both dividend income and capital gains by holding both income stocks and growth stocks in their portfolios.
They may hold stocks that provide both dividends and capital gains.
The investor doesn't necessarily look for high yielding stocks but for stocks that offer the potential for high rates of growth in their dividends.
Quality is a concern for total-return investors.
The only difference between them and current-income and quality long-term growth investors is that total-return investors care more about the amount of return than the source of return.
Total-return investors seek the most attractive returns wherever they can find them, be it from a growing stream of dividends or from the price of a stock.
Aggressive stock management seeks attractive rates of return through a fully managed portfolio.
An investor using this strategy aggressively trades in and out of stocks to achieve eye-catching returns.
Blue chips, growth stocks, big-name tech stocks, mid-caps, and cyclical issues are the primary investments.
Some of the more speculative tech stocks and foreign shares could be considered by more aggressive investors.
The quality long-term growth strategy is similar to this approach.
It involves more trading and the investment horizon is shorter.
Instead of waiting 2 or 3 years for a stock to move, an aggres sive stock trader would go after the same investment payoff in 6 to 12 months.
This strategy involves timing security transactions and turning investment capital over quickly.
When the market is bullish, these investors try to stay invested in the stock market.
They put a lot of their money into defensive stocks when the market weakens.
There are substantial risks and trading costs in this aggressive strategy.
Real demands are placed on the individual's time and investment skills.
The rewards can be substantial.
The least conservative investment strategies are speculation and short-term trading.
Capital gains are the sole objective of this strategy.
The longer the goal can be achieved, the better.
Although investors who use this strategy confine most of their attention to speculative or small-cap stocks and tech stocks, they are not averse to using foreign shares if they offer attractive short-term opportunities.
Information about the industry or company is less important than market psychology or the general tone of the market according to many speculators.
As new opportunities appear, it is a process of constantly changing positions.
Many transactions yield little or no profit because the strategy involves so much risk.
When one does hit, the hope is that returns will be enough to offset losses.
This strategy requires a lot of time and knowledge.
It also requires psychological and financial strength to survive financial losses.
Discuss the investment merits of each of the following.
Plan 6.1 has long been a popular investment vehicle because of its attractive return opportunities.
Common stocks can be used to fit any investment need.
Stock returns include both dividends and capital gains.
The long run returns of stocks have ranged from 10% to 12%.
The 1990s were a great decade for stocks, as they generated returns of anywhere from 20% to 30%.
One of the biggest bull markets in history came to an end in 2000.
The S&P 500 fell more than 50% from 2000 to 2002, but it rebounded to an all-time high in October 2007.
The S&P 500 lost half of its value between 2007 and 2009, and nearly doubled over the next two years to a post-recession high in early 2011.
The market set a new all-time high in early 2015 after giving back 17% in 2011.
Video Learning Aid traded stock can be issued via a public offering or through a publicly traded issues.
Understand the different stock values.
The book value is an accounting value.
Plan 6.5 share their profits by paying out cash dividends.
Buy-and-hold, current income, quality long-term growth, aggressive stock management, and speculation and short-term trading are some of the investment strategies that can be followed by investors.
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There are three pairs of stocks.
Pick the security you want to own based on the amount of money you want to spend.
A wealthy woman comes to you looking for investment advice.
She has $250,000 to put into stocks.
She is willing to tolerate a fair amount of risk in order to build up as much capital as possible.
Explain the rationale for at least three types of stocks.
Explain the three sources of return to U.S. investors in foreign stocks.
For the beginning and end of a hypothetical one-year investment horizon, the British pound, the Australian dollar, and the Mexican peso are listed.
U.S. dollars are the official currency of the United States.
An investor has stock in Harry's Pottery Inc.
The stock split happened recently.
An investor has a large amount of money.
He deposits money into a account.
He buys 1,000 shares of the Commercial International Bank.
The investor sold the stock one week later.
The company has total assets of $8 million, long- and short-term debt of $4.8 million, and $650,000 worth of 9% preferred stock.
Ben's Burgers is trading at $23 per share.
There are a lot of shares.
The MedTech Company had net profits of over 15 million dollars.
It pays preferred dividends of $1 million per year and has 2.5 million shares of common stock.
If the firm paid $2 per share to common stockholders, what the firm's dividend yield would be?
On January 1, 2015, an investor bought 200 shares of Al-Masry Steel.
The investor sold the stock for a profit.
The stock paid a quarterly dividend.
Consider the information about Truly Good Coffee, Inc.
The following can be found using the information above.
The company is currently trading at $35 per share.
200 shares of Consolidated Glue are owned by a man.
The company's board of directors recently declared a cash dividend of 50 cents a share payable on April 18 to shareholders of record on March 22.
It is assumed that Wilfred will hold on to the stock.
Southern Cities Trucking Company has a five-year earnings per share record.
Select any three stocks listed on the Saudi Arabian stock exchange and determine the latest book value per share, earnings per share, and dividend yield using the resources at your public library or on the internet.
An investor purchased 800 shares of the rapidly growing high-tech conglomerate in January of 2012 The stock turned in dividends and share price performances.
The investor bought stock in 2012 at this price.
The annual holding period returns for 2012 through 2016 can be found on the basis of this information.
George Robbins is an investor.
He's thinking about investing in foreign securities, and he's looking at two companies, one of which is a German chemical and health-care firm.
The price of Bayer AG is 53.25 euros per share.
The dividends are 1.50 euros per share.
Robbins thinks the stock will go up to 60.00 euros per share over the next year.
The expected exchange rate is 1.015EUR/US$.
The price of Swisscom's stock is 71.5 Swiss Francs per share.
The dividends are 1.5 Sf per share.
Its share price is expected to go up in a year.
By the end of the one-year holding period, 1 Sf is expected to be worth $0.85 in the U.S.
Bruce bought UH- OH Corporation stock.
The stock price fell by 50% after a major newspaper revealed that the company was being investigated for accounting fraud.
She has been able to accumulate a lot of money over the past few years.
She has worked hard to get to this point, but never imagined it would be like this.
Sara has not been spoiled by success.
She keeps in touch with her old friends.
Terry is Sara's financial advisor and he is one of her closest friends.
Sara attended a seminar about investing in the stock market and since then she's been reading about it.
She has decided that she doesn't make sense to keep all of her money in savings accounts.
Sara decided to move some of her money to stocks.
The stock pays no dividends.
Sara feels that the growth prospects of the company have never been brighter, because more people are going to the beaches the way they are these days.
The computer firm pays a modest dividend of 1.50%.
Quality growth stock is what it is.
Sara knows that T&C offers excellent long-term growth and capital gains potential.
The income stock has a yield of around 5%.
It has limited growth prospects because of its location.
Inflation has become a problem and this stock has performed well in the past.
Sara thinks that if it can do well in inflationary times, it will do even better in a strong economy.
The stock has experienced price swings in the past.
It doesn't pay dividends.
Whether there's a place for dividends is a question that commercial artist Wally Wilson ponders.
A way to achieve long-term growth and capital appreciation is by investing in high-quality growth stocks.
He feels that high-quality issues are his best bet because of the limited time he has to devote to his security holdings.
Some of his growth stocks aren't doing as well as some of his income shares, so he's a bit perplexed by the market.
He decided to have a chat with his broker.
During their conversation, it becomes clear that both Al and Wally are thinking in the same direction.
The outlook for growth stocks is not particularly bright, because of the state of the economy, as Al points out.
He suggests that Wally put some of his money into income shares to get high dividends.
Hydro-Electric Light and Power is a high-yield public utility stock.
The stock is trading at $60 per share.
It should be trading at $75 to $80 a share within five years, according to Al.
To buy the Hydro-Electric stock, he will have to sell his holdings of CapCo Industries, a stock that he dislikes because of its recent substandard performance.