Work detail

The Impact of an Announcement of a New Car Model on the Price of Stocks of Automobile Companies

Author: Bc. Ján Micenko
Year: 2013 - summer
Leaders: prof. PhDr. Ladislav Krištoufek Ph.D.
Consultants:
Work type: Bachelors
Language: English
Pages: 61
Awards and prizes:
Link: https://is.cuni.cz/webapps/zzp/detail/123051/
Abstract: This work studies the impact of an introduction of a new car model on the stocks of the introducing company and its rivals and also the impact of an earnings announcement on the stocks of the introducing company. I use two different approaches to explore these effects, one focusing on the stock returns through the CAPM and the other focusing on the volatility of stocks using GARCH model. I found that the new model introduction has a significant positive effect on the returns of stocks of the announcing company but I found no definite effect on the returns of stocks of the competition. Moreover, I found that the new model introduction has no effect on the volatility of stocks of the announcing company and similarly I found no definite effect on the volatility of stocks of the competition. Furthermore, I found that the earnings announcement has no definite effect on the stock returns of the announcing company but that it has a significant positive effect on the volatility.

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