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I chose the stocks in table 1 from the Yahoo Finance website https://finance.yahoo.com/most-active (Yahoo Finance, 2022) . Date Oct 19 Oct 19 Oct 19 Oct 19 Symbol ABEV PBR SHLX PCG Name Ambev S.A. Petrobras Shell Midstream Partners PG&E Corp Price 2.76 14.87 15.82 13.96 Change -0.04 +0.52 -0.01 -0.19 % Change -1.43 +3.62 -0.06 -1.34 Volume 36,913,911 34,801,021 22,273,759 15,267,984 Table 1 b. Discuss why you have chosen the four stocks as an investor. I chose the four stocks because they are all well above their 52 week lows, whereas most stocks at the moment are testing new lows. These are four, which seem to have recent strength, caught my eye as something that I might want to own in the current environment. ABEV is a consumer staple producer of drinks and food. This is a defensive stock that should hold value in the face of inflation and rising interest rates. Both SHLX and PBR are energy stocks. PBR is a producer which is benefiting from strong oil prices. SHLX transports petroleum products in the U.S, and although the price of oil does not directly affect its profit, demand for oil does. This stock pays a generous dividend while I wait for oil demand to increase in the US during the heating season. PCG is a utility that transports and sells natural gas and electricity in California. It has recent relative strength and is a momentum buy. Utilities are defensive plays as well.

2. Discuss the trends of each stock’s performance over time. ABEV has gone from the $6-$7 range approximately 5 years ago to it’s current value. It has traded between $2-$3 for the last 2 years. PBR has traded between $16.60 and $4.85 since 2017, and has been climbing from that low to it’s current value since early 2020. SHLX has been in a downtrend from almost $30 to a low of $8.75 in early 2020, and then a slow climb to it’s current value. PCG was at $53 in 2017 before dropping to a low of $5.00 in 2019. It has been in a slow climb for the last year. 3. Explain the rate of return for each of the stocks you have chosen. The rate of return for ABEV would include an annual 3.85% dividend as well as any appreciation in the stock’s price. Had I bought the stock on Jan 3, 2022 for $2.72, it has appreciated by 4 cents per share, or 1.47% plus I will receive the dividend for another 3.85%. PBR started the year at $11.15 and has paid out $1.21, $1.46 and $2.59 in dividends. The total return YTD is $8.98 for a return of 80.5%. SHLX was $11.52 at the beginning of the year. It has distributed $0.90 in dividends and has a rate of rerun of 46.7%. PCG started the year at $12.06 and therefore the rate of rerun is 15.7%. 4. Discuss the potential risks as an investor for each of the stocks that you have chosen. The biggest risk for ABEV is a crash in consumer demand and an unsustainable increase in the cost of its raw ingredients. If it cannot pass along its higher costs to its customers, it will not be profitable. PBR could suffer if the price of oil or demand declines significantly. It might also be subject to an accident during production which would also be a significant risk. SHLX is subject to risk if it suffers a leak or spill. A significant disruption in its operations due to a large spill

could be catastrophic for the company. PCG is subject to climate change and dwindling demand for gas. The infrastructure it operates is very expensive to maintain and suffers damage from weather events like floods annually. 5. Based on your research with the stocks you picked, explain what you think is the best investment type for you (bank accounts, bonds, stocks, mutual funds, or assets). I chose a consumer staple, energy producer and transporter and a utility. All of these companies would be expected to hold or increase in value during times of economic uncertainty and increasing interest rates and inflation. I think stocks are a liquid asset that I am comfortable owning and expect to increase in value over time. Some level of cash is important to keep on hand, so a bank account is a good idea. I do not have much interest in bonds as I am not content with the amount they appreciate over time and I prefer dividends for income. Mutual funds may be a way for me to hold stocks or other assets like gold indirectly. I would consider these at the appropriate times. I think the best investment type for me is probably stocks because I want my wealth to increase over time, but I would use the other types of investments at appropriate times. References

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Greenlaw, S. &. (2018). Principles of microeconomics, 2e. Open Stax Rice University. Retrieved from https://d3bxy9euw4e147.cloudfront.net/oscms-prodcms/media/documents/ Microeconomics2e-OP.pdf Yahoo Finance. (2022). Yahoo Finance Most Actives . Retrieved from Yahoo Finance: https://finance.yahoo.com/most-active

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