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Portfolio Management Mohammed ALqurashi 200700610Abdulah AL Tewijiri 200600055Ishmeal AL abas 200901599 12/19/2012 University Portfolio Management 2012 1. Technical analysis is simple and straightforward, with tools available to everyone from the seasoned hedge fund manager, to the novice retail trader. In addition, technical tools are easier to interpret than fundamental indicators, the understanding of which usually requires a period of diligent study. Finally, since technical analysis focuses on the price action exclusively, the technical trader has only one needle in his compass: the price, on which any calculation about profits or losses must be based. On the other hand, the fundamental analysis one of the disadvantages of fundamental analysis is the need to adapt to each company. Methods of fundamental analysis may vary depending on the industry and the unique factors of a particular company. 2. In Excel 3. Find the breadth of the market for the last 12 months. For this, you have to use data from other sources, if necessary. Comment on that. 2 Portfolio Management 2012 We used yahoo finance in order to get Ford’s 12 months data for stock price. As the graph shows the recovery and momentum that the ford’s stock movement shows was between Jan 12 to May 12 and its start to recover in the end of 2012. 4. Find the 100-day moving average for your firm’s stock price and the index. You need daily data for your firm and the index. Comment on that. The moving average between Ford Company and S&P 500 shows positive correlation relationship, the movements of S&P 500 index reflect the performance of Ford company stack price. So we will notice it 2008 and 2009 during the financial crisis that the index sharply decline as well as Ford stock price. 5. using your stock price data show the major trend, intermediate trend and short-run movements. Do the same for the index. Give comments on this. Major Trend: during the 2007 to 2009 the whole economy went to a major rescission the data shows the Index price movements were in 2008 and 2009 in fluctuation zone, and that’s because during the struggling of the global market during these two years. Intermediate Trends: Ford Company’s stock price and return as the data shows from 2006 and 2010 the return of ford was suffering because the financial crisis. Short- term Trends: The 12 months data for Ford company stock price shows stability in the movement of the stock. During 2011 the stock tends to be more healthy and stable than be for. But during 2012 the stock price decline slightly because other events such as the Arabian spring that affect the oil price movements. 6. Find the relative strength for your firm in the last 60 months. What is your comment? 3 Portfolio Management 2012 Relative strength calculates which investments are the strongest performers, compared to the overall market, and recommends those investments for purchase. Relative strength is a "buy high, sell higher" strategy that assumes a stock whose price has been rising will continue its upward trajectory. (investopedia.com) Ford Company As shows above that ford’s stock price movement reach it maximum investment in 2011. If we look to the period between 2008 and 2010 we can observe the weakness in the performance of ford stock price movements. The relative strength reaches it maximum in 2011 and the analysts expect to reach again in 2014. 4 Portfolio Management 2012 7. Based on all the previous findings, make your final comment? This is the time to buy or sell? The global economy passes in recovery period with slight struggles. The U.s economy witness a good recovery period right now after avoiding the economy cliff. The investors decision should based on the past tends of the index movements, the trends of Ford Co shows a good movements with much less fluctuations in the stock movements. Our advice to the investor to buy and regardless of the slight drop but in the future our data shows ford’s stock is in good shape. 5