I'm adding a new feature to the blog: Looking at Stocks.
I'm going to use this feature to try out a "fantasy" stock market account. I will be starting with $20K and I will be picking stocks and tracking them. I am aiming for weekly updates on this project though I post updates throughout the week if a stock is in need of selling or buying.
Although this series of articles will be based on a fictitious stock market account I will be using real numbers and I will explain why I have decided to add each stock to the portfolio.
Here is the breakdown of my initial $20K investment in stocks:
1) AMD - 400 shares - $8536.00 purchased 12/5/6 at $21.34 per share.
It was a toss up for me between AMD and Intel. I wanted to have some computer chips in my portfolio and after looking over both company's recent news reports I find that AMD is the better buy.
Some of the things in favor of AMD are:
a) It's progress in making lower power chips.
b) Conversion to 65 nanometer chip construction.
c) It's plan to start production of 45 nanometer chips in mid 2007.
d) It's recent contract with Dell.
2) T - 300 shares - $10404 purchased 12/5/6 at $34.68 per share.
I have to tell you up front that I do own AT&T stock in my personal holdings. With that said, I feel that the two main telecom stocks worth watching are AT&T and Verizon.
Verizon stock has had a rough year, losing almost $9 per share over the last year. AT&T stock has gained over $10 per share over the same time span. AT&T is also close to sealing up it's deal to acquire Bell South and attain complete ownership of the cellular carrier Cingular.
Verizon does have it's FIOS service in it's corner but AT&T is quickly becoming the reborn Ma Bell and I expect the deal to go through sometime in 2007. AT&T is also rolling out it's own fiber-based TV system and I expect, at some point in the next five years, something will occur between these two large telecom companies.
3) YHOO - 38 shares - $1042.34 purchased 12/5/6 at $27.43 per share
I wanted to have some sort of Internet stock in this portfolio and with only $1060 left in the account I could not afford much. I think Google shares are far to pricey right now and I still can't understand why anyone would pay so much for that company's stock when you don't get much out of it. The same could be said of Yahoo but it's not as pricey!
Yahoo is entering the market that is currently dominated by AdWords/AdSense and I think they will be able to capture a portion of that market right away. I figure that most of the people who were banned from AdSense for suspected click-fraud will quickly sign up for Yahoo's competing service and this will bring a quick gain once they open the service up to more publishers.
I now have a remaining cash balance of $17.66. I'll hold onto this money as cash until I sell some of these stocks and reinvest the gains.
DISCLAIMER: I am not a stock market analyst. Following the suggestions in this series of articles is done at your own risk. The buying and selling of these stocks, in regards to this series of articles, is entirely hypothetical as no money ever changes hands. Before you invest in any stocks or bonds please take some time to talk to someone who knows more about the market than I do!