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New evidence on the impact of the English national soccer team on the FTSE 100
Abstract
During the last decades, many empirical studies have indicated a significant influence of noneconomic factors on asset pricing. More recently, it seems to be acknowledged that international soccer match results significantly affect subsequent daily returns of national stock markets via investor sentiment. In this article, we provide evidence that such observations should be treated with caution. Resuming a current debate on the link between the performance of England's national soccer team and FTSE 100 returns, we validate findings made by Ashton et al. (2011). Our results raise doubts on their conclusions and emphasize the importance of thoroughly validating empirical results.
... In general, DJIM outperforms the conventional index. However, in comparison to these findings, which suggests numerous differences between conventional and Islamic indices, some of the studies have found no significant differences between these two indices, that are, those of Umer et al., 2019 andBauckloh et al., 2019. For a thorough comparison between these two indices, several other researchers (Shaikh et al., 2019;Bauckloh et al., 2019;Umer et al., 2019;Landi and Sciarelli, 2019) have explored the overall performance of Financial Times Stock Exchange (FTSE) and Sharia indices, specifically the firm's performance and its influence on returns and volatility in different contexts (crisis and noncrisis) and found contrasting/mixed results. ...
... However, in comparison to these findings, which suggests numerous differences between conventional and Islamic indices, some of the studies have found no significant differences between these two indices, that are, those of Umer et al., 2019 andBauckloh et al., 2019. For a thorough comparison between these two indices, several other researchers (Shaikh et al., 2019;Bauckloh et al., 2019;Umer et al., 2019;Landi and Sciarelli, 2019) have explored the overall performance of Financial Times Stock Exchange (FTSE) and Sharia indices, specifically the firm's performance and its influence on returns and volatility in different contexts (crisis and noncrisis) and found contrasting/mixed results. For example, in their study, Tahir and Ibrahim (2020) argue that companies that fulfill the Sharia criteria have performed way better than non-Sharia-complaint firms concerning their overall returns. ...
Purpose
The purpose of this study is to investigate the impact of COVID-19 on conventional and Islamic stocks by using the data spanning from February 25, 2020, to February 3, 2021, and employing a panel regression approach.
Design/methodology/approach
In this study a panel regression approach has been used.
Findings
The study finds a negative association between COVID-19 and stock (both Islamic and conventional). After splitting the data into 1st and 2nd waves, the relationship between COVID-19 and stock (both Islamic and conventional) remains the same (negative) in the case of the 1st wave. In contrast, in the case of the 2nd wave, the relationship turned out to be positive. During both waves of the pandemic, the magnitude of the effect is found to be higher for conventional stocks. Additionally, the study also analyzes the aggregate influence of COVID-19 on different sectors and finds that commercial banks, oil and gas exploration and marketing companies are the most influenced sectors. At the same time, automobiles and pharma are the least affected sectors.
Practical implications
The study suggests that markets start gaining momentum to reach their prepandemic level after absorbing the initial shock (emergence of a pandemic). The study also provides thorough insights for market regulators and policymakers by implying the dynamic relations between markets (conventional and Islamic) and financial crisis, which would allow them more effective control of crisis in future endeavors.
Originality/value
This is one of the first studies to investigate the impact of COVID-19 on both conventional and Islamic stocks, especially in the context of Pakistan.
... Second, we propose cryptocurrency market decomposition into various sectors for the purpose of more efficient performance benchmarking. Finally, our work extends the literature on football and finance (Ashton et al. 2011;Bartling et al. 2015;Ehrmann and Jansen 2016;Bauckloh et al. 2019). ...
... Second, we propose cryptocurrency market decomposition into various sectors for the purpose of more efficient performance benchmarking. Finally, our work extends the literature on football and finance (Ashton et al., 2011;Bartling et al., 2015;Ehrmann and Jansen, 2016;Bauckloh et al., 2019). ...
This paper investigates the emerging segment of the cryptocurrency market related to football fan tokens (FFTs) – digital assets used for engagement with professional football clubs around the world. More specifically, we study investability of the FFTs from the perspective of risk and return. We find that FFTs generate a whopping 150% return on the first-trading-day. This return is significantly larger if FFT market cap is higher, FFT offer price is lower, football team displays better historical performance, and is domiciled in a relatively smaller city with the higher GDP per capita. We also find that in the long-run FFTs severely underperform all major crypto benchmarks including NFT, DeFi, Meme, and Bitcoin. Moreover, the returns to FFTs tend to be highly volatile (160% annualized). Intriguingly, we find that the real-life performance of football teams does not affect contemporaneous market performance of their FFTs.
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