The
4th week of the stock market challenge was filled with several ups
and downs, dropping me in the same position as previous weeks, but ranked in
the bottom half of the group. Continuing with similar strategies, I hoped to
have made greater gains through investing larger amounts of money into stocks.
With these risks, came either rewards and or consequences and for the majority
of the week, the outcomes were unpleasantly not in my favour. Despite another
obstacle during this journey, I knew I had a stock in mind that was certain to
rise in the later days of the week. I was determined to rise back to, from
where I fell, and that’s exactly what I did.
To
begin with, Pier 1 Imports was a major loser in the stock market game for me
personally this past week. After hitting a 52 week low a few weeks back, I was
positive the stock would rebound and a few of my peers in my class believed the
same and insisted I invest in the company for my own benefit. Before I
invested, I implemented my strategy of analyzing the company and reading the
opinions of several investors on the position and future outlook of the company
in the upcoming days. Several headlines roared that Pier 1 Imports would rise
to about 4.50, which at the time was significant when the stock was barley
above the 4-dollar mark. In addition, during the second half of trading on
Wednesday the stock began to rise significantly, which insisted I buy the share
to earn a large sum of profit. The one article that was the deciding factor to
my purchase of several thousand shares was from equities.com. This article had
mixed reactions on the stock of Pier 1 hitting a 52-week low, and explained how
investors from around the world could see the company in two different
perspectives. It explained how investors who are “bearish” would outlook a
negative downward momentum for the stock and sell their shares as soon as
possible. The second viewpoint they presented was that investors who were
“bullish” strongly believed the stock would rebound and bounce back up to its
median price range. Personally, I was optimistic about the stock and took the
risk. I wanted to be bullish and take on the risk head first, which in the long
run was the wrong choice as it pushed my farther away from my goal I set at the
start of the competition. 
A
major gainer for me during week 4 was once again EA Sports, whose share value
increased by over one dollar over the span of Friday from 83 to 84 dollars.
This new 52-week high, was beneficial for me as it recovered my losses in the
past days from investments such as Pier 1 Imports, and put me above the 100 000
dollar standard. As mentioned in my post last week, EA had released several new
games and had one game being released in a few weeks that had a great sum of
excitement and high hopes that would drive sports fanatics around the world
crazy. Before I invested my entire buying power into this stock, I chose to
once again collect research to reinforce my confidence in this share, and as
you may know by now I was not disappointed. Dozens upon dozens of articles were
“all in” for EA, dropping an average price target of about 87.04 dollars per
share that won me over. Moreover, articles explained how EA over the years have
earned double digit growth in their share value, about 18% over the span of the
fiscal year of 2015. In addition, analysts from Reuters all ranked EA as a
stock to either buy and or hold for the coming weeks, as they are enthusiastic
about the stocks potential growth due to the newly reconstructed FIFA 17. Finally,
through my past experience EA Sports has been a positive share I have invested
in and without a doubt my overall percentage gain for the final day of week 4
was about 1.25% within just 4 hours of holding the share.
As
week 4 had come to end, filled with a roller coaster of emotions a lesson I am
taking away from my experience is to invest in stocks that are priced 15
dollars or lower, to maximize the amount of money I earn over the next 40 days
of the challenge. Last week I had learned that the amount of money made by a
stock is determined by the overall percentage gain and the amount of shares
owned. If a share were worth less, an increase by about 10 cents would be more
significant compared to a stock that is worth 85 dollars, an example being EA
Sports. During the past week, I faced the negative aspect of this, as Pier 1
Imports stock dropped 5 cents from 4.20. As I owned over 20 000 shares, a
decrease of 5 cents resulted in over a thousand dollars in losses, which compared
to a 10 cent loss in EA, was extremely significant. Therefore, with this new
lesson under my belt, I can convert this knowledge into a strategy that will
assist significantly as I work my way up both financially and among the
rankings in the stock market challenge. The race is still on.
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