Wednesday, November 17, 2010

It aint over till the cow says MOO!

Week #8
In the final week of the game, we decided to hold onto the stocks we acquired during the prior week, until Friday when our portfolios needed to be liquidated. As it turns out, we should have liquidated earlier in the week. As the week went on, the stock prices continued to drop, but in hopes that the markets may turn around in time, we continued to hold onto the stocks.

We had our ups and downs throughout the course of this game, good decisions, bad decisions, once accidently short selling and another time choosing the wrong stock to short sell. We held a few stocks too long, and sold a few stocks too soon. We had a few hesitations when it came to buying, which lead to us to not make all of the money we potentially could have.  A major shift in our strategy at the end of week five which, if only momentarily, did turn the game around for us and showed us the effects of volatile markets. 
The results of our decisions lead us to rank place 9th in the US market with $106,140.90 and 22nd in the Canadian markets with $99,767.54. We are happy with our results in the US market however we are not pleased with the results in the Canadian market, but hey, this was our first try at beating the markets. It was a learning experience.  We now have a better understanding of what our “strategy” was, and how we will apply ourselves next semester.
Focusing on an economic event affecting the stock markets we looked at the United States investigation of President Obama.  There has been a great deal of speculation that the President has been on a spending spree and is pushing the US to bankruptcy.  The US midterm election indicates that their people are up in arms about the state of their economy, their jobs, their lives, and their future.  This has been felt in the markets as the nation is losing faith in the economy’s ability to recover. Many Americans remain optimistic regarding economic recovery, as they understand these things do not happen overnight.

These foresights have caused the US market to fluctuate rapidly, which for a buy sell strategy is good. Understanding how the US market would react on a day to day basis was the main obstacle we faced. In hindsight the US was not the best place to be. The Canadian markets were more stable, as our economy has been recovering at a steady pace. Canadians have faith in its recovery, and this reflects the behaviour of the market. Bottom line the game is over and we rolled the dice. We milked the market and our best efforts were not felt
Terms:
Cowboy Marketing

What Does Cowboy Marketing Mean?
A slang term to describe a situation in which a company is unaware that a marketer hired to produce legitimate opted-in email campaigns is actually using mass spam emails to promote the company's stock. This is a very unethical practice because marketers are often compensated with 
stock options, allowing them to capitalize on the unfounded demand they create for the stock they are promoting.

Investopedia explains Cowboy Marketing
This situation occurs when the marketer values its own interest over those of its client. Smart investors should not pay attention to spam emails and/or the stocks they promote. Buying these stocks will more often than not result in losing money because once the stock's price rises, the unscrupulous parties involved will cash out, causing it to plummet and leaving legitimate investors with losses.

Doomsday Call

What Does Doomsday Call Mean?
A call provision added to fixed income securities that allows for early redemption by the issuer if certain conditions are favorable.

Investopedia explains Doomsday Call
Also known as Canada calls, these provisions are typically found on corporate debt issues made by Canadian corporations. With a doomsday call provision, issuers are able to redeem at either par value upon maturity of the fixed income security or at a predetermined rate which is usually a benchmark +/- basis points

Moofer

What Does Moofer Mean?
An employee working outside of typical office settings. The word "moofer" stands for "mobile out of office worker," and this type of worker is becoming more common as communication technology continues to improve. Moofers can generally work anywhere where there is access to a wi-fi connection.

Investopedia explains Moofer
Some examples of moofers include Internet entrepreneurs that can work from a laptop, bloggers, columnists, etc. It can also refer to people that have to be mobile as part of their job, like consultants, reporters or business people that frequently have to go out to make deals or meet clients.


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