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The ups and downs of Wirecard AG: An application of the reversed news model

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  • Stadtmann, Georg
  • Croonenbroeck, Carsten

Abstract

In early 2019, the stock prices of the German company Wirecard AG experienced market turmoil after several critical reports on activities claimed to be illegal. To analyze the market impact of news, we use stock price data for Wirecard AG and apply the reversed news model. We elaborate on whether new information can explain subsequent changes in the stock price. We find that articles published in the Financial Times as well as investor communications were important drivers of the stock price.

Suggested Citation

  • Stadtmann, Georg & Croonenbroeck, Carsten, 2019. "The ups and downs of Wirecard AG: An application of the reversed news model," Discussion Papers 414, European University Viadrina Frankfurt (Oder), Department of Business Administration and Economics.
    • Handle: RePEc:zbw:euvwdp:414
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    References listed on IDEAS

    as
    1. Ellison, Sara Fisher & Mullin, Wallace P, 2001. "Gradual Incorporation of Information: Pharmaceutical Stocks and the Evolution of President Clinton's Health Care Reform," Journal of Law and Economics, University of Chicago Press, vol. 44(1), pages 89-129, April.
    2. Fama, Eugene F, 1970. "Efficient Capital Markets: A Review of Theory and Empirical Work," Journal of Finance, American Finance Association, vol. 25(2), pages 383-417, May.
    3. Carsten Croonenbroeck & Fabrizio Leonardo Monaco & Mads Julius Christensen, 2015. "Does Danish Football Club Brøndby Swim With the Fishes? An Application of the Reversed News Model," Journal of Sports Economics, , vol. 16(4), pages 425-433, May.
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    More about this item

    Keywords

    News Model; Stock Market Efficiency; Event Study;
    All these keywords.

    JEL classification:

    • D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information; Mechanism Design
    • G14 - Financial Economics - - General Financial Markets - - - Information and Market Efficiency; Event Studies; Insider Trading
    • G32 - Financial Economics - - Corporate Finance and Governance - - - Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; Goodwill

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