- 25 Mar, 2021
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- 3 Mins Read
Equity Capital
Major companies are posting their corporate reports on their web-
sites. You can use these as a source for earnings data, especially from export
oriented operations.
2. All major Canadian banks have US operations so could be used in the
project. You might also look at foreign banks or brokerage houses with large
international operations. Examples are JP Morgan, Chase, Merrill Lynch, Citi bank, Deuchbank, Royal Bank, TD Bank, CIBC. 3. Mining, railway, airline and oil companies are involved in trade in one
way or another. You might consider Barrick Gold, Vale, Exxon, BP, Royal
Dutch Shell, CP Rail, Amtrack, Air Canada, American Airways.
4. Luxury goods, fashion companies and cosmetic companies have great
interests in trade. You might look at Moet-Hennessy, Chanel or major dis-
tillers.
5. Agricultural or consumer products firms like Coca-Cola, PepsiCo,
Monsanto, Procter and Gamble, Merck, Pfizer, MacDonald’s have strong
interests in international trade or operate in many markets. MacDonald’s
produces locally in many countries; in effect this US firm has exported its
product by producing it locally worldwide.
6. You might look at car companies such as GM, Ford and Chrysler but
emphasize their export potential.
7. Hotel chains such as Hyatt and Hilton can be viewed as being involved
in international trade since they support tourism.
8. You should rely on sources other than the internet for current events
and analysis of these events. Try The Wall Street Journal, The Economist,
The Financial Times or The Report on Business in The Globe and Mail. The
reason is that there’s more analysis in these periodicals than internet sites.
But the internet is good for stats on corporate earnings etc.
General Points
1. Provided you can obtain information and price quotes for companies
traded on Continental European and Asian stock exchanges you are welcome
to include those in the project. Using North American or UK companies
is fine as well. Report profits and losses Canadian dollars. If you buy a
foreign company you need to buy the currency in which it is priced first.
The exchange rate is the Canadian dollar (CAD) price of 1 unit of foreign
currency. For example, suppose you need 100,000 US dollars (USD) to buy
some shares on the NYSE. If the exchange rate is 1.3 CAD per USD you will
spend 130,000 CAD to get the 100,000 USD. Consider reporting profits in
CAD. Multiply your total portfolio value in foreign currency by the exchange
rate after closing out your position. So if you sell your stocks for 105,000
USD and the exchange rate is 1.32 CAD you receive 105,000× 1.32 CAD as a total return. 2. Cite all sources of corporate earnings. inflation rates, GDP statistics
etc. Sources for lesser known facts about corporate strategies should be
cited as well. The sample trade shows you one method of citation though
any method is fine. Also you can use the style in the sample trade for the
bibliography. Note when presenting stats in the body of the paper you must
cite the source there. Essentially you note the source for the stats which
appears in the bibliography directly in the body. Failure to cite sources for
stats and facts that are not widely known in the body of the text is a form
of plagiarism.
3. Be creative in your choice of companies. Make sure they are linked to
international trade.
4. Do not direct most of your presentation to motivating trades. Instead,
spend time discussing why the trades succeeded or failed. When analyzing
these reasons pay attention to current events linked to trade. Using macroe-
conomic as well as microeconomic factors is fine but keep the emphasis on
trade based micro analysis.
5. Comparative advantage, the notion that some countries are better at
producing some goods or services than others, underlies many trade models.
While competitive advantage cannot explain actual trade patterns it is useful
for motivating purchasing a company’s shares. For example, the quality
of French products can be used to motivate buying Moet-Hennessy. Coca
Cola owns Tropicana orange juice. The US has a comparative advantage in
producing certain agricultural products such as oranges. Not all countries
can produce oranges. This fact could motivate buying Coca Cola shares,
especially if you can cite earnings from that segment of Coca Cola’s business.
6 Certain companies have been analyzed too often in eco365. return avoid the following companies: Toyota, Samsung, Tesla, Amazon.