Abnormal Returns of Soccer Teams: Reassessing the Informational Value of Betting Odds
Journal of Sports Economics, Vol. 16, No. 7, 2015
30 Pages Posted: 4 Feb 2012 Last revised: 19 Feb 2018
There are 2 versions of this paper
Event Clustering and Abnormal Returns: Reassessing the Informational Value of Bets
Date Written: August 26, 2013
Abstract
We analyse the links between soccer match results, betting odds and stock returns of all listed European soccer teams. Using an event-study approach, we measure positive (negative) abnormal returns following wins (ties and losses). Additionally, we analyse the role, which we find to be non-significant, of betting odds in shaping market reactions to unexpected results. We propose an alternative econometric approach, using seemingly unrelated regressions models, to take into account the problem of overlapping events. Abnormal returns following unexpected results are then found to be statistically significant, and to magnify the positive (negative) effects of wins (losses).
Keywords: Information and Market Efficiency, Event Studies, Soccer, Bets, Event Clustering, Seemingly Unrelated Regression Equation (SUR)
JEL Classification: G14, L83, C30
Suggested Citation: Suggested Citation
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