Indicate The Companies You Are Investing In Please Use Your

Indicate The Companies You Are Investing Inplease Use Your Knowledge

Decide on three US companies that are publicly traded, ensuring good diversification across different industries. For each company, indicate the amount you plan to invest from a total of $25,000, such as $10,000 in Company 1, $10,000 in Company 2, and $5,000 in Company 3. Provide a brief reason for choosing each company, based on your knowledge or expectations. For each company, specify the current share price and calculate the number of whole shares you can purchase with your allocated funds, recognizing that fractional shares are not permissible. For example, if a stock is priced at $42.16 and you have $10,000 to invest, you could buy 237 shares ($42.16 * 237 = $9,991.92), which is close to the allocated amount. Repeat this process for each company to complete your diversified investment plan.

Paper For Above instruction

In constructing a diversified investment portfolio comprising three publicly traded US companies, it is imperative to select firms across different industries to mitigate risks and optimize potential returns. The following discussion details such a portfolio, including investment amounts, reasons for selection, share prices, and the number of shares purchased.

Company 1: Apple Inc. (AAPL)

Apple is a multinational technology company renowned for its innovation, strong brand loyalty, and consistent financial performance. I have chosen Apple because of its dominance in consumer electronics, services, and software, aligning with my expectation of continued growth fueled by innovation and ecosystem synergy. Currently, Apple shares are trading at approximately $170.00 per share (as of October 2023). Allocating $10,000 to this stock, the number of shares purchasable would be $10,000 / $170.00 ≈ 58.82. Since fractional shares are not purchasable, I will buy 58 shares, costing $9,860.00 (58 × $170.00). This investment provides exposure to a leading tech giant with a history of growth and resilience.

Company 2: Johnson & Johnson (JNJ)

Johnson & Johnson is a leading health care company with diversified operations encompassing pharmaceuticals, medical devices, and consumer health products. I selected J&J for its stability, dividend history, and diverse product portfolio, which can serve as a hedge against the volatility inherent in technology stocks. The current share price is approximately $165.00. With a $10,000 investment, I can purchase $10,000 / $165.00 ≈ 60.61 shares. Rounding down, I will buy 60 shares, amounting to $9,900.00. The remaining funds can be reserved for future additions or transaction costs. J&J’s steady performance and dividend payments make it a reliable component of my diversified portfolio.

Company 3: The Coca-Cola Company (KO)

Coca-Cola is an iconic beverage company with a global presence and strong brand recognition. Its defensiveness during economic downturns and consistent dividend payments appeal to my investment strategy focused on stability. The current share price is approximately $60.00. Using a $5,000 investment, the number of shares achievable is $5,000 / $60.00 ≈ 83.33. I will purchase 83 shares, totaling $4,980.00. The remaining funds can be set aside or reinvested later. Coca-Cola’s resilient business model and dividend history provide income stability and diversification from the technology and health sectors.

Overall, these three companies—Apple, Johnson & Johnson, and Coca-Cola—offer a diversified mix of technology, healthcare, and consumer staples. The allocation of $25,000 across these stocks balances growth potential with stability, aligning with prudent investment principles and risk management strategies.

References

  • Apple Inc. (2023). Annual Report 2022. Retrieved from https://www.apple.com/investor/annual-reports/
  • Johnson & Johnson. (2023). 2022 Financial Results. Retrieved from https://www.jnj.com/investor-relations
  • The Coca-Cola Company. (2023). Annual Report 2022. Retrieved from https://www.coca-colacompany.com/investors
  • Yahoo Finance. (2023). Apple Stock Quote. Retrieved from https://finance.yahoo.com/quote/AAPL
  • NASDAQ. (2023). Johnson & Johnson (JNJ) Stock Price. Retrieved from https://www.nasdaq.com/market-activity/stocks/jnj
  • New York Stock Exchange. (2023). COCA-COLA (KO) Stock Price. Retrieved from https://www.nyse.com/stock/KOF
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