Five Big companies’ stock price change in recent 12 years and some analysis

The five big companies are Apple, Amazon, Google, Coca-Cola and Goldman Sachs.

Apple represents technology companies, Amazon and Google represent the new internet companies, Coca-Cola represents traditional food companies and Goldman Sachs represents those financial companies.

Graphs are divided into three parts:

Stock price change in 12 years

Stock price change in 2007 to 2008

How people’s attention will affect stock price?

 

 

 

 

Firstly, according to five companies change in these 12 years, what can tell us?

Blue line is Coca cola, which is one of the biggest food companies. It seems that it is the most stable one. The stock price of it almost didn’t change in these 12 years. Maybe we can say Coca cola’s stock is really low risky.

Compare to Coca cola, let’s look at the pink line, which is Goldman Sachs, and it is the biggest financial company in the World. If we just compare the price of 2018 and 2006, it didn’t change a lot. However, the process of Goldman sachs is totally different from Coca cola, it is obvious to see that the fluctuation is extremely high.

Then for the orange line, which is Apple. I will say that Apple is relatively stable, it is keep increasing, and the fluctuation is not big. Maybe Apple is a good stock to invest as a low-risk stock.

For the green line and yellow line, which are Google and Amazon. I would like to put them together to talk. Because they are both relatively new companies, and they are both internet companies, and the most important thing is their stock price both increased incredibly in last 12 years. However, according to this graph, they still have some differences. We can see in 2018, amazon is higher than google, but in 2006, amazon is less than half of Google, so increase rate of Amazon is higher.

As we all know, from 2007 to 2008, financial crisis exploded, how these stocks performed during that time, and what information can we receive from this?

According to this graph, the stock prices of Google, Goldman Sachs, and Amazon had big fluctuation. For Goldman Sachs, it is not hard to understand, because it is a financial crisis and Goldman Sachs a huge financial company, its stock price decreased was normal. For two internet companies Amazon and Google, although they had big fluctuation during the financial crisis, they almost recovered after 2008, because you can see the price at the end of 2008 was almost same as 2007. For Apple and Coca cola, they were still stable, and looks weren’t affected by financial crisis a lot.

It is almost impossible to predict how a stock price change, but can we find some data closely relate to stock price change?

I made a guess that Will people’s attention affect the stock price?

I got the google trends of apple and amazon, and put them into the stock price change graph to show whether they have an relationship.  (Google trends is a tool to see how many times people search these key words in Google)

 

It looks fine, especially for amazon, we can see that much of them have a positive relation. The part of yellow shadow shows where the two line looks close with each other.

To prove my guess a little more, I build two plots of them to show the relationship between stock price and google index.

According to the straight line, we can see that it is a positive relation for both of these companies. The same thing is the relationship between stock price and google index in amazon is more obvious.

What’s more, I also build a regression model to see the specific correlation between them. According to the R squared value, I found that there are approximately 49.7% of the variance in stock price can be explained by the google trends for apple, on average. For amazon, the R squared value can reach up to 67.1%, that means there are approximately 67.1% of the variance in stock price can be explained by the google trends for amazon.

The first one is Amazon, and the second one is Apple.


Methodology 

Stock price’s data are collected from Kaggle (https://www.kaggle.com/datasets), and google search index are from google trends (https://trends.google.com/trends/?geo=US).

Stock price change graphs are built by R in ggplot package.

Also using some Adobe Illustrators to change some colors and shape.

 

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