Journal of Wealth Management, 16(4), 48-54. January, 2014
15 Pages Posted: 19 Jun 2011 Last revised: 26 Jan 2014
Date Written: June 1, 2011
This paper examines if firms in the United States with quality training programs can enjoy above-the-market-average benefits and performance by analyzing risk premiums and risk-adjusted excess returns of a portfolio of public firms in the United States, which are ranked consecutively from 2006 to 2011 in the top 50 of the Training Top 125, to determine if the portfolio risk premiums are higher than the market risk premiums and to investigate if the portfolio can generate positive risk-adjusted excess returns. The portfolio average risk premiums are all positive and economically greater than the market risk premiums for the 5-year holding period intervals. All of the portfolio average risk-adjusted excess returns from the single-index and four-factor models are positive (some are statistically significant) for the 3-year and 5-year holding period intervals. This study shows that firms in the United States with quality training programs should be able to enjoy above-the-market-average benefits and performance in the long run, on average.
Keywords: Risk premiums, risk adjusted excess returns, training
JEL Classification: G11, G12, G14
Suggested Citation: Suggested Citation
Sum, Vichet, Quality of the Firm’s Training and Stock Returns (June 1, 2011). Journal of Wealth Management, 16(4), 48-54. January, 2014. Available at SSRN: https://ssrn.com/abstract=1865966 or http://dx.doi.org/10.2139/ssrn.1865966