IDEAS home Printed from https://ideas.repec.org/a/ids/ijmpra/v9y2016i3p238-256.html
   My bibliography  Save this article

Impact of elections on stock price graph: a case of US elections

Author

Listed:
  • Abhishek Behl
  • Shreya Sethi

Abstract

This paper focuses on the impact of US presidential elections on stock market. Thus, this paper aims to analyse the impact of the US presidential elections that have taken place from 1980 to 2010, on the stock market performance for eight different industries. The paper puts special emphasis on studying the abnormality of return related to stock prices and evaluating the uncertainty between the firm's tax policy and stock market, around the time of upcoming presidential elections. This is a comparative study wherein the effects of pre- and post-election have been assessed. The empirical analysis undertaken relies on secondary data collected from various online sources. The results of the papers highlight; industry return data churn out ambiguous results when compared for winning election party. Also, the rate of reaction tends to differ grossly with respect to different industries. Democratic victory impacts the stock return negatively but in case of Republican victory the result is insignificant. A positive correlation exists between abnormal stock price and firms' marginal tax rate around the day of the election. The paper proves there is a transitional effect of election, felt in the stock market irrespective of the anticipated outcome of the election.

Suggested Citation

  • Abhishek Behl & Shreya Sethi, 2016. "Impact of elections on stock price graph: a case of US elections," International Journal of Management Practice, Inderscience Enterprises Ltd, vol. 9(3), pages 238-256.
    • Handle: RePEc:ids:ijmpra:v:9:y:2016:i:3:p:238-256
    as

    Download full text from publisher

    File URL: http://www.inderscience.com/link.php?id=77817
    Download Restriction: Access to full text is restricted to subscribers.
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ids:ijmpra:v:9:y:2016:i:3:p:238-256. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sarah Parker (email available below). General contact details of provider: http://www.inderscience.com/browse/index.php?journalID=91 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.