Introduction
The portfolio involved three different companies; Aarons Inc, Delta Airlines Inc (DAL) and the Deutsche Global High-Income FD. In order to determine its current value, it would be necessary to work with the prices which they commanded during the start of the start of business in August 15. The prices at the time was $45.78 for the investments at Aarons Inc, $50.25 for the investments at Delta Airlines Inc and $8.79 is a total of $7084.74.
|
STOCK PRICE |
|||
|
INVESTMENT |
WEEK 3 |
WEEK 8 |
% CHANGE |
| Aarons INC | 39.99 | 45.78 | 14.48 |
| Delta Air Lines, INC | 53.79 | 50.25 | -6.58 |
| Deutsche Global High-Income FD | 8.73 | 8.79 | 0.687 |
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Initial investment
|
Investment |
Current value | Number of Shares | Total Value |
|
Aarons INC |
39.99 |
250 |
$9750 |
|
Delta Air Lines, INC |
53.79 |
148 |
$7960.92 |
|
Deutsche Global High-Income FD |
8.73 |
806 |
$7036.38 |
|
Total Investment |
$24747.3 | ||
New total investment
|
Investment |
Current value | Number of Shares | Total Value |
|
Aarons INC |
45.78 |
250 |
$11,445 |
|
Delta Air Lines, INC |
50.25 |
148 |
$7,437 |
|
Deutsche Global High-Income FD |
8.79 |
806 |
$7,084.74 |
|
Total Investment |
$25,966.74 | ||
Generally, the investments have been profitable. On the close of business in 19 th July, the total value of the investments was $24747.3. When the business opened, the total value of the investments was $25,966.74 which was an improvement of $1219.44 from the closing. Similarly, the investments made in Aarons Inc and Deutsche Global High-Income made an improvement between the two dates. Aarons INC improved the most with a 14.48% improvement. The price for their stock moved from $39.99 to $45.78. This means each share improved with $5.79 which means $1447.50 from that investment alone.
The stock in Deutsche Global also improved although not significantly. The overall improvement was 0.687% which means the price for each stock is $8.79 from %8.73. Delta Air Lines Inc on the other hand was a significant loss. Although it had initially looked promising, it endured a loss of 6.58%. which is very significant in the portfolio. The loss means that for every stock unit, $-3.54 was lost which totaled $523.92.
The Aarons Inc investment has been consistent to what was expected. It’s 6% growth it is well within the confines of 3%-11% which is good. Given the consistency, there should be more stock bought in that organization. Around 30 units which will cost the $1400 that the investment brought. The Delta Airlines is an investment that should be discarded. To a company that made a 14% improvement in the previous year, having -6% improvement is very bad. It shows that the money can be lost and fast. The money from the sale of the stock should be used to get an investment that is profitable.
Since the stock of Deutsche Global is cheap, it means that one could own a lot of shares. The advantage with having many shares is that the risks are minimal and any gains could be significant. At the moment, the performance is satisfactory although it would make sense to study its performance in the future. I should not have invested in the airlines industry because it usually is cost incentive and has a small profit margin. The improvement of 14% could have been a sudden spike and not there for long.
From this assignment, I have learnt that constant and intense evaluation on a company is important. One should understand the industry, the challenges it stands to experience and what they could mean to the individual’s investments. This is a lesson that is important in life as it can help me select a profitable portfolio in future which could be very profitable.
