Stock Price & Currency Exchange Rate Correlation

The assignment investigates the relationship between stock prices and currency exchange rates for three companies: Etherstack plc, Jack-In Group Limited, and Wesfarmers Limited. It compares the stock price movements with changes in relevant currency exchange rates (GBP/AUD, SGD/AUD) and analyzes the observed correlations. The analysis uses historical data from Yahoo Finance and aims to determine if currency fluctuations significantly impact stock prices for these companies.

Running Head: Finances
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Project Report: Finances

Finances
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Que 1a
A) List of stocks:
Australian Based MNC
Name of company
Ticker
Symbol
Amount of
investment
Price per share
(17 Nov 2017)
Wesfarmers Limited WES $ 10,000
$
42.42
Woolworths Limited WOW $ 10,000
$
25.86
Australian Based MNC
Name of company
Ticker
Symbol
Country where
company is
based
Amount of
investment
Price per
share (17
Nov 2017)
Etherstack plc ESK
United
Kingdom
$
10,000
$
0.16
Jack-in Group
Limited JIP Singapore
$
10,000
$
0.10
B) Week Wise stock performance:
Week 1 (24th Nov 2017)
No.
Name of
company
Stock
price at
end of
the week
% change
in stock
price Primary Reason
1
Wesfarmers
Limited 43.21 1.86%
A news article explains that the Australian
retail sector is increasing rapidly and thus the
stock price of the company has been enhanced.
2
Woolworths
Limited 26.31 1.74%
A news article explains that the Australian
retail sector is increasing rapidly and thus the
stock price of the company has been enhanced.

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3 Etherstack plc 0.12 -25.00%
In current week, the stock price of the company
has been lowered due to some internal changes
(Yahoo Finance, 2018).
4
Jack-in Group
Limited 0.11 10.00%
The stock price of the company has been
enhanced due to new project.
Week 2 (1st Dec 2017)
No.
Name of
company
Stock
price at
end of
the week
% change
in stock
price Primary Reason
1
Wesfarmers
Limited 43.89 1.57%
The stock price of the company is continuously
increasing due to the current retail industry
report and the annual report has also been
announced by the company.
2
Woolworths
Limited 26.87 2.13%
The stock price of the company is continuously
increasing due to the current retail industry
report and the dividend amount has also been
announced by the company.
3 Etherstack plc 0.12 0.00%
In current week, no changes have been occurred
into the stock price of the company (Yahoo
Finance, 2018).
4
Jack-In Group
Limited 0.11 0.00%
Short term speculation effect is there in the
stock price
Week 3 (8th Dec 2017)
No.
Name of
company
Stock
price at
end of
the week
% change
in stock
price Primary Reason
1
Wesfarmers
Limited 43.98 0.21%
Short term speculation effect is there in the
stock price

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2
Woolworths
Limited 26.91 0.15%
Short term speculation effect is there in the
stock price
3 Etherstack plc 0.12 0.00%
In current week, no changes have been occurred
into the stock price of the company (Yahoo
Finance, 2018).
4
Jack-In Group
Limited 0.11 0.00%
Short term speculation effect is there in the
stock price
Week 4 (15th Dec 2017)
No.
Name of
company
Stock
price at
end of
the week
% change
in stock
price Primary Reason
1
Wesfarmers
Limited 44.59 1.39%
Announcement about the new project and the
advanced technology has attracted the
investors.
2
Woolworths
Limited 27.07 0.59%
Short term speculation effect is there in the
stock price
3 Etherstack plc 0.12 0.00%
In current week, no changes have been occurred
into the stock price of the company (Yahoo
Finance, 2018).
4
Jack-In Group
Limited 0.11 0.00%
In current week, no changes have been occurred
into the stock price of the company.
Week 5 (22th Dec 2017)
No.
Name of
company
Stock
price at
end of
the week
% change
in stock
price Primary Reason
1
Wesfarmers
Limited 44.22 -0.83%
Short term speculation effect is there in the
stock price

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2
Woolworths
Limited 27.53 1.70%
The trend of investing in the retail company is
still ongoing and thus the stock price of the
company is increasing.
3 Etherstack plc 0.11 -8.33%
Changes into the operations and the activities of
the company directly affected the stock price of
the company.
4
Jack-In Group
Limited 0.1 -9.09%
The competitive position of the company has
distracted the stock price.
Week 6 (29th Dec 2017)
No.
Name of
company
Stock
price at
end of
the week
% change
in stock
price Primary Reason
1
Wesfarmers
Limited 44.42 0.45%
Short term speculation effect is there in the
stock price
2
Woolworths
Limited 27.3 -0.84%
Short term speculation effect is there in the
stock price (Yahoo Finance, 2018).
3 Etherstack plc 0.09 -18.18%
The annual report announcement has affected
the stock price of the company.
4
Jack-In Group
Limited 0.1 0.00%
In current week, no changes have been occurred
into the stock price of the company (Yahoo
Finance, 2018).
Week 7 (5th Jan 2018)
No.
Name of
company
Stock
price at
end of
the week
% change
in stock
price Primary Reason
1
Wesfarmers
Limited 44.56 0.32%
Short term speculation effect is there in the
stock price (Yahoo Finance, 2018).
2
Woolworths
Limited 27.26 -0.15%
Short term speculation effect is there in the
stock price

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3 Etherstack plc 0.09 0.00%
Short term speculation effect is there in the
stock price
4
Jack-In Group
Limited 0.08 -20.00% Competition effect (Yahoo Finance, 2018).
Week 8 (12th Jan 2018)
No.
Name of
company
Stock
price at
end of
the week
% change
in stock
price Primary Reason
1
Wesfarmers
Limited 43.73 -1.86%
Deductions in the stock price have taken
position due to competitive companies and the
investment.
2
Woolworths
Limited 27.25 -0.04% Competition effect
3 Etherstack plc 0.1 11.11%
The competition and the industry changes have
affected the stock price of the company (Yahoo
Finance, 2018).
4
Jack-In Group
Limited 0.08 0.00%
In current week, no changes have been occurred
into the stock price of the company.
Week 9 (26th Jan 2018)
No.
Name of
company
Stock
price at
end of
the week
% change
in stock
price Primary Reason
1
Wesfarmers
Limited 42.25 -3.38%
Deductions in the stock price have taken
position due to competitive companies and the
investment.
2
Woolworths
Limited 27.08 -0.62%
Short term speculation effect is there in the
stock price

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3 Etherstack plc 0.11 10.00%
The competition and the industry change shave
enhanced the stock price of the company.
4
Jack-In Group
Limited
0.08 0.00%
In current week, no changes have been
occurred into the stock price of the company.
Que 1b
Que 2
Wesfarmers Vs ASX:
Figure 1: Wesfarmers Vs ASX 200
The above graph explains that the stock price of all ordinary shares of Australia is
highly correlated with the stock price of Wesfarmers limited. It has been found through a
study that Wesfarmer’s plays a great role in AXJO prices and thus the changes in both the
stock are correlated with each other (Bromwich and Bhimani, 2005).
Woolworth’s petroleum Vs ASX:

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Figure 2: Woodside Vs ASX
Same study has been done over the stock prices of Woodside limited. The above
graph explains that the stock price of all ordinary shares of Australia is highly correlated with
the stock price of Woodside limited. In the month of Aug, the stock price of Woodside was
highest. It has been found through a study that Woodside plays a great role in AXJO prices
and thus the changes in both the stock are correlated with each other.
Que 3a
Etherstack plc Vs LSE:
Figure 2: Etherstack plc Vs LSE
The above graph explains that the stock price of London stock exchange does not
have any connection with the stock price of Etherstack plc in last few months. The stock
price of company is quite constant and at the same time, huge difference is there in stock

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price of LSE. This study explains that in current situation, the stock prices are not at all
correlated (Damodaran, 2011).
Jack-In Group Limited Vs STI:
Figure 4: Jack-In Group Limited Vs LSE
Same study has been done over the stock prices of Jack-In Group Limited. The above
graph explains that the stock price of STI is not correlated with the stock price of Jack-In
Group Limited. It has been found through a study that Jack-In Group Limited plays
independently in the market and its prices are not affected by the price of STI (Yahoo
Finance, 2018).
Que 3b
Etherstack plc Vs Jack-In Group Limited:

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Figure 4: Etherstack plc Vs Jack-In Group Limited
Further, both the foreign stocks have been compared and it has been found that the
stock price of both the companies is showing a great up and down trend. It explains that the
current stock price of both the companies is different but the trend is almost same. Both the
prices are correlated with each other.
Que 3c
Etherstack plc Vs ASX:
Figure 5: Etherstack plc Vs ASX
Further, the stock price of Etherstack plc has been compared with the stock prices of
Australians stock exchange to evaluate the changes. It explains that the current stock price of

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the company and the ASX prices are quite different to each other. There is no correlation
among both the prices.
Jack-In Group Limited Vs ASX:
Figure 6: Jack-In Group Limited Vs ASX
Further, the stock price of Jack-In Group Limited has been compared with the stock
prices of Australians stock exchange to evaluate the changes. It explains that the current stock
price of the company and the ASX prices are bit different to each other. There is moderate
correlation among both the prices.
Que 4
Wesfarmers Vs Exchange rates:

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Figure 6: Wesfarmers Vs Exchange rates
In addition, the stock price of Wesfarmers limited has been compared with the
currency changes into USD to AUD. Through the study, it has been found that there is a good
correlation among the prices. Further, it has also been found that the currency changes have
impacted a lot over the stock prices.
Woolworths Vs Exchange rates:
Figure 6: Woodside Petroleum Vs Exchange rates
Further, the stock price of Woodside petroleum limited has been compared with the
currency changes into USD to AUD. Through the study, it has been found that there is a good

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correlation among the prices. Further, it has also been found that the currency changes have
impacted a lot over the stock prices.
Que 5
Etherstack plc Vs Exchange rates:
Figure 7: Etherstack plc Vs Exchange rates
Lastly, the same study has been done for the Etherstack plc and it has been found that
the stock price of Etherstack plc has been compared with the currency changes into UK
pound to AUD. Through the study, it has been found that there is a moderate correlation
among the prices. Further, it has also been found that the currency changes have impacted a
lot over the stock prices (Besley and Brigham, 2008).
Jack-In Group Limited Vs Exchange rates:

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Figure 8: Jack-In Group Limited Vs Exchange rates
Lastly, the same study has been done for the Jack-In Group Limited and it has been
found that the stock price of Jack-In Group Limited has been compared with the currency
changes into SGD to AUD. Through the study, it has been found that the correlations are
quite higher but in the 5th week, the exchange price has been higher whereas the stock price
was stable. Further, it has also been found that the currency changes have impacted over the
stock prices bit.

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References:
Besley, S. and Brigham, E.F., 2008. Essentials of managerial finance. Thomson South-
Western.
Bierman, H., 2010. An introduction to accounting and managerial finance: a merger of
equals. World Scientific.
Bromwich, M. and Bhimani, A., 2005. Management accounting: Pathways to progress. Cima
publishing.
Damodaran, A, 2011, Applied corporate finance,3rd edition, John Wiley & sons, USA
Procházka, D. 2017. The Impact of Globalization on International Finance and Accounting:
18th Annual Conference on Finance and Accounting (ACFA). Springer.
Yahoo Finance. 2018. Jack-In Group Limited. [Online]. Available at:
https://finance.yahoo.com/quote/JIP.AX/history?p=JIP.AX [Accessed on: 26 January 2018].
Yahoo Finance. 2018. Etherstack plc. [Online]. Available at:
https://finance.yahoo.com/quote/ESK.AX/history?
period1=1510857000&period2=1516559400&interval=1d&filter=history&frequency=1d
[Accessed on: 26 January 2018].
Yahoo Finance. 2018. Wesfarmers Limited. [Online]. Available at:
https://au.finance.yahoo.com/quote/WES.AX/history?
period1=1510857000&period2=1516473000&interval=1d&filter=history&frequency=1d
[Accessed on: 26 January 2018].
Yahoo Finance. 2018. Woolworths Limited. [Online]. Available at:
https://au.finance.yahoo.com/quote/WOW.AX/history?
period1=1510857000&period2=1516473000&interval=1d&filter=history&frequency=1d
[Accessed on: 26 January 2018].

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