Analyze 4 Stocks Including Apple, Dell, Coke and McDonalds Throughout the Capm

Introduction

In this paper, our group is going to analyze 4 stocks including Apple, Dell, Coke and McDonalds throughout the CAPM, diversification analysis, efficient frontier and capital allocation line. Our goal is to construct an optimal well-diversified portfolio including the four stocks.

Apple Company was started by Steve Jobs, Steve Wozniak and Ronald Wayne. From the last three decades, the company had expanded its products from computers to consumer electronics and officially changing their name from Apple Computer, Inc. to Apple, Inc. Now the company’s products include MacBook Pro, MacBook Air, iMac, Xserve, Apple TV, the iPod and the iPhone. Up until the 29 May, 2013, its market capitalization is 417.65 billion dollars. The market shares of, its computer products and mobile phone products, which are the company’s main products are 7% and 33% respectively. Apple’s competition position in smart phone market is very high as we can see it almost occupied one third market. However, the company is not doing as well in the computer market as in the smart phone market.

Dell Company is advanced computer distributors in the world. It is also the number one PC supplier in the U.S. Moreover, it retails its merchandise directly to customers through telephone orders and website, which wipes off intermediary so it could provide low-price products to customers. The market capitalization is 23.35 billion dollars until today. Its main competitors include HP, Lenovo, Acer Group and Asus. Dell occupies 12.6% of market share, which is just lower than HP in the computer market.

McDonald’s Corporation is a big international fast food chain. It owns more than thirty thousand branches in the world. The company’s restaurants are operated either by the company or by franchisees. It has 99.3 billion dollars market capitalization and 13% of market, which is the number one in the fast food industry.