Australia Stock Exchange (ASX) plays an important role within our economy. There is approximately 1.5 million companies registered in Australia, and of those, over 2,000 are listed and traded on ASX. One of the examples of a company listed on the ASX is BHP Billiton. BHP Billiton is a leading global mining company, it mines and processes a diverse range of the major commodities including, iron ore, metallurgical coal, conventional and non-conventional oil and gas, copper, energy coal, aluminium, manganese, uranium, nickel and silver.
The aim of this report is to help the readers develop an understanding of BHP performance. The first section of the report will provide the readers the analysis of the weekly BHP closing share prices. The second section of the report will summarise the weekly returns of BHP, analyse and interpret the data to examine the overall performance of BHP. Lastly, it will analyse the relationship between BHP returns and all ordinaries index returns.
2.0 Analysis of Data
2.1 BHP Closing Share Price
The closing price is a very useful marker for investors to access changes in share prices over time. The closing price represents the most up-to-date valuation of a security until the trading commences again on the next trading day. The analysis below analyses the BHP weekly closing prices from the time period of 11 January 1999 to 31 December 2012.
Figure 1 shows the historical view of BHP closing share price from the period January 1999 - December 2012. Starting from the lowest price of $5.56 per share, it increased slowly from January 1999 to December 2003. It started to increase more rapidly since January 2004 and reached the peak of $48.7 in May 2008. However, due to the global financial crisis it had fallen to the price of $21.9 in December 2008, with a 55 per cent fall in just a few months time. As of April 2011, it has rebounded to $47.32, representing a 53 per cent increase from the December 2008 low. The...