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The effect of presidential election in the USA on stock return flow – a study of a political event

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  • Saša Obradović
  • Nenad Tomić

Abstract

The subject of this paper is to determine the statistical significance of abnormal return that appeared on the New York Stock Exchange after the presidential election in the USA in November 2012. The analysis is focused on securities of the financial institutions listed on the New York Stock Exchange, whereby 85 companies have been included. For the purposes of the analysis a standard methodology of event study has been used. In general, parametric tests show a statistically significant negative impact of the event on stock return, whereby with the nonparametric tests there is no consistent estimation. This paper provides an interpretation of the results.

Suggested Citation

  • Saša Obradović & Nenad Tomić, 2017. "The effect of presidential election in the USA on stock return flow – a study of a political event," Economic Research-Ekonomska Istraživanja, Taylor & Francis Journals, vol. 30(1), pages 112-124, January.
    • Handle: RePEc:taf:reroxx:v:30:y:2017:i:1:p:112-124
    DOI: 10.1080/1331677X.2017.1305802
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    Cited by:

    1. Delia DiaconaÅŸu & Seyed Mehdian & Ovidiu Stoica, 2023. "The Global Stock Market Reactions to the 2016 U.S. Presidential Election," SAGE Open, , vol. 13(2), pages 21582440231, June.
    2. Sunkung Choi, 2023. "Measuring economic diplomacy using event study method: the case of EU-China summit talks and Airbus stock price changes," Asia Europe Journal, Springer, vol. 21(2), pages 155-171, June.
    3. Deari Fitim & Koku Paul Sergius, 2024. "Do Local Political Elections Affect Daily Stock Returns? Evidence from the Republic of North Macedonia's MBI10 Index," Studia Universitatis „Vasile Goldis” Arad – Economics Series, Sciendo, vol. 34(1), pages 98-116, March.

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