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Stock Help 101?


ok so i have 2 do something for a project and i need 2 find a stock and here is all the info: PLZ help PLX!!!!!!!!!!!!
here it is:

The essay should demonstrate that the student:

Understands that buying a stock means investing in a company鈥檚 future;
Can explain the difference between investing and speculating;
Can present thoughtful reasons for investing in a stock for the long run.

STUDENT BACKGROUND
A comedian once offered this advice to investors: Buy stocks when their prices are low, and sell them when their prices are high. If they don鈥檛 go up, don鈥檛 buy them. People laughed because finding a good stock today means correctly estimating its earnings per share in the future. Smart stock picking requires knowing what a stock is and how its price/earnings ratio can help prevent paying too much for it. It requires judging a company鈥檚 future prospects in order to make a sound investment for the long term.

so i need something wut the background info says PLZZZZZZZ

As a someone studying for an advanced accounting degree, I will offer you the following advice without writing your paper for you:

Pick a product or an item you like or use, something really high quality.
Example: Ipods
Find out what company makes that product.
Example: Apple makes ipods.

Now:
Stocks are a share of ownership on a company. You buy a stock to make money, so when you buy stocks, you presumedly want to buy part of a company that will grow and not go out of business.

"Understands that buying a stock means investing in a company鈥檚 future;"
--Tell why the future of the company will enable it to make money, i.e. why that product will be good, or what future products they will make will be big hits.

"Can explain the difference between investing and speculating;"
--This you should be able to do on your own. Investing involved carefully considered decisions, speculating is like buying a lottery ticket.

"Can present thoughtful reasons for investing in a stock for the long run."


There it is.

Hope this helps.

Soooo pick some stocks that market necessities...Procter& Gamble, Johnson & Johnson..Kroger, Safeway....so you are "investing" not speculating ( you think people are going to stop buying toothpaste? soap? toilet paper?)
Then do your comparisons...p/e, etc.
How about "energy" stocks... are things going to change to wind, sun, ethanol ? If you think not, that's investing ( buying oil companies, refiners)....if you go the other way that's speculating.( you are speculating that everyone is going to have panels on their roofs pretty soon.)

Dear 101, what do you like? I know that it is a daunting task to peruse the market listing in the paper. In order to make sense of it all consider first what you would like to invest in. Forget the project for a minute. The stock market is divided into sectors; ex.pharmaceuticals, energy, communication, transportation, consumer goods and such. Now, where would You like to put your money? After you make that decision, you can start to look at individual companies. Remember that there are no magic bullets that will propel you to instant wealth. You have it partly right when you say that you have to weigh a companies earnings against its future potential. Some people swear by the P/E ratio, I for one, do not. There are stocks that are over-valued, just as there are stocks that are under-valued. The P/E is just one indicator of how a stock may or may not perform. Remember that you are not obligated to keep a stock for all eternity. If it doesn't perform to your expectations then sell it.
I'll tell ya what, Research one specific Stock, Energy Metals Corp., symbol on the NYSE is EMU from there you should be able to determine if it is a good buy or not. Hope this helps.

Since you need advice for 101 I cannot give something like 360 or 540. It should be simple right. So for buying stocks you can write the purpose which is inflation hedge to protect the value of ones savings. Elaborate everything I give in one sentence. Like protecting ones value means you can give a short explanation of consumer price index and how it moves and how money value gets disturbed when it moves and so on and so forth, then come up with the return on each stock investments which covers up for the loss in currency holdings.
Investing in companies future is checking out the long term prospects of the company like its products,its value etc;.
Speculating is doing investing without studying the company or not following any acceptable strategies. Just gambling. You can give examples of different valuation formulas, even P/E which you have come up with and so on and so forth.
Thoughtful reasons on investing in stock market for long is again with an eye on protecting value of ones wealth where stockmarkets usually give nominal returns that are higher than nominal loss in value of ones wealth. In fact so doing it protects as well as improves value of your wealth.
Refer some books and look into the terminologies I used in wikipedia or something or investopedia and elaborate after understanding the terminologies properly. Good luck kid.

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