Comparative Analysis: Stock Performance of Samsung, Apple, and Google

This assignment analyzes the stock prices of Samsung, Apple, and Google from September 27, 2018, to October 30, 2018. It examines the fluctuations in share prices, calculates rates of return, and determines the average return and variance for each company. The analysis includes variance-cova...Read More

Running head: ACCOUNTING AND FINANCE
Accounting and Finance
Name of the Student:
Name of the University:
Authors Note:

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ACCOUNTING AND FINANCE
Contents
Part 1:...............................................................................................................................................2
Answer 2:.........................................................................................................................................4
Answer 3:.........................................................................................................................................6
Answer 4:.........................................................................................................................................7
Answer 5:.........................................................................................................................................8
Answer 6:.........................................................................................................................................9
Answer 7:.......................................................................................................................................10
Answer 8:.......................................................................................................................................11
References:....................................................................................................................................12

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ACCOUNTING AND FINANCE
Part 1:
The stock prices of Samsung, Apple and Google since September 27, 2018 are provided below to
understand the fluctuations that have taken place in the share prices of the respective companies
over the last 22 trading days. The table below shall be helpful in assessing the return during the
period between 27th September, 2018 and 30th October, 2018.
Date Samsung Apple Google
27-09-18 47500 227.26 1208.53
28-09-18 46450 229.28 1207.64
01-10-18 46350 232.07 1211.53
02-10-18 45700 227.99 1177.07
04-10-18 44700 224.29 1167.83
05-10-18 44700 223.77 1155.92
08-10-18 44950 226.87 1145.17
10-10-18 45300 216.36 1092.16
11-10-18 43100 214.45 1090.74
12-10-18 44000 222.11 1120.54
15-10-18 43800 217.36 1102.44

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ACCOUNTING AND FINANCE
16-10-18 43600 222.15 1133.08
17-10-18 44150 221.19 1127.59
18-10-18 44050 216.02 1097.91
19-10-18 43900 219.31 1105.18
22-10-18 43550 220.65 1111.37
23-10-18 43050 222.73 1114.91
24-10-18 42550 215.09 1057.12
25-10-18 41000 219.8 1103.59
26-10-18 41000 216.3 1083.75
29-10-18 41400 212.24 1034.73
30-10-18 42350 213.3 1049.51
The above information shows the fluctuation in market prices of the shares of the above three
companies. Initial looks make it clear that except Apple Inc. other two companies, i.e. Google
and Samsung both have experienced decline in share prices. The decrease in market value of
shares of Samsung is quite significant.

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ACCOUNTING AND FINANCE
Answer 2:
Rate of return calculated in the table below for the three companies have considered the
fluctuations in prices of respective shares of the companies on each day since 27th September,
2018 to 30th October 2018.
Samsung Apple Google
Date Price Return
(%)
Price Return
(%)
Price Return
(%)
27-09-18 47500 0.21097 227.26 0.673341 1208.53 0.120125
28-09-18 46450 -2.21053 229.28 0.88885 1207.64 -0.07364
01-10-18 46350 -0.21529 232.07 1.216853 1211.53 0.322116
02-10-18 45700 -1.40237 227.99 -1.75809 1177.07 -2.84434
04-10-18 44700 -2.18818 224.29 -1.62288 1167.83 -0.785
05-10-18 44700 0 223.77 -0.23184 1155.92 -1.01984
08-10-18 44950 0.559284 226.87 1.385351 1145.17 -0.93
10-10-18 45300 0.778643 216.36 -4.63261 1092.16 -4.62901
11-10-18 43100 -4.85651 214.45 -0.88279 1090.74 -0.13002
12-10-18 44000 2.088167 222.11 3.571928 1120.54 2.73209
15-10-18 43800 -0.45455 217.36 -2.13858 1102.44 -1.61529

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ACCOUNTING AND FINANCE
16-10-18 43600 -0.45662 222.15 2.203717 1133.08 2.77929
17-10-18 44150 1.261468 221.19 -0.43214 1127.59 -0.48452
18-10-18 44050 -0.2265 216.02 -2.33736 1097.91 -2.63216
19-10-18 43900 -0.34052 219.31 1.523007 1105.18 0.662167
22-10-18 43550 -0.79727 220.65 0.611007 1111.37 0.56009
23-10-18 43050 -1.14811 222.73 0.942669 1114.91 0.318526
24-10-18 42550 -1.16144 215.09 -3.43016 1057.12 -5.18338
25-10-18 41000 -3.64277 219.8 2.189781 1103.59 4.395906
26-10-18 41000 0 216.3 -1.59236 1083.75 -1.79777
29-10-18 41400 0.97561 212.24 -1.87702 1034.73 -4.52318
30-10-18 42350 2.294686 213.3 0.499435 1049.51 1.428392
The return calculated from share prices of the company, i.e. by subtracting the opening price of
the share from its closing price in a day shows that except Apple the other two companies have
significant decline in the share prices in the above period. Though the time between 27
September 2018 and 30 October 2018 is very small for calculation of return on the basis of
movement in share prices of any company however, this certainly provides a starting point to the
existing as well as future investors to identify the shares of a company or companies to hold on
to or invest in the future.

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Answer 3:
Calculation of average return and variance are provided below:
Samsung Apple Google
Total return (5,100.000
0)
(8.400
0)
(117.9500
)
Total return (%) (10.736
8)
(3.696
2)
(9.759
8)
Average return each days (Total return /33) % (0.488
0)
(0.168
0)
(0.443
6)
Variance of return 2.520454842 3.893743 5.89070127
Discussion:
From the above table it is clearly visible that out of the above three stocks, i.e. Apple,
Samsung and Google, variance in rate of return is highest for Google with 5.89. In comparison
both Samsung and Apple have provided stable return to the shareholders with variance of 2.52
and 3.89 respectively. Thus, the return on the shares of Google is most vulnerable to changes.
During the above period Samsung end up losing significant value of its share in the stock market.
The shares of the company has suffered most degradation in market value over the 22 days
period with a loss of 10.74% in the value of the shares. Google has also lost around 9.76% in the
value of its shares in last 22 days. Average return of Samsung as well as Google are in negative

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ACCOUNTING AND FINANCE
indicative of declining share prices of these companies between 27th September, 2018 and 30th
October, 2018.
It is clear from the average return in the last 22 days as well as the variance in average return that
Apple has dominated the other companies as the loss in share value of the company has been
lowest out of three companies with loss of 3.70% in the share prices of the company in the above
period. Other two companies, namely Samsung and Google have lost significant value of the
shares over this period.
Answer 4:
Variance covariance matrix between Samsung and
Apple
0.067886
Variance covariance matrix between Samsung and
Google
-0.09347
Variance covariance matrix between Apple and
Google
0.897327
Answer 5:
Part a:
Apple and Google have highest correlation coefficient.
Combinations Weight Apple Weight Google Return Standard deviation
1 0.4 0.6 0.095547 0.008944

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2 0.6 0.4 0.05977 0.008944
3 0.5 0.5 -0.00049 0.039075
4 0.3 0.7 0.113436 0.017888
5 0.7 0.3 0.041882 0.017888
6 0.8 0.2 0.023993 0.065662
7 0.9 0.1 0.006105 0.074606
8 1 0 -0.01178 0.08355
9 0.2 0.8 0.131324 0.011997
Part b:
Apple and Samsung have lowest correlation coefficient.
Combinations Weight Samsung Weight Apple Return Standard deviation
1 0.4 0.6 0.081552 0.001947
2 0.6 0.4 0.12822 0.025281
3 0.5 0.5 0.104886 0.013614
4 0.3 0.7 0.058218 0.00972

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5 0.7 0.3 0.151554 0.036947
6 0.8 0.2 0.174887 0.009785
7 0.9 0.1 0.198221 0.046668
8 1 0 0.221555 0.033119
9 0.2 0.8 0.034884 0.060217
Answer 6:
The MEF on the basis of highest coefficient stocks.
The MEF below is on the basis of two lowest coefficient stocks.