Corporate Political Strategies and Return Predictability

32 Pages Posted: 9 Aug 2018

See all articles by Chansog (Francis) Kim

Chansog (Francis) Kim

The State University of New York at Stony Brook

Incheol Kim

University of Texas Rio Grande Valley (UTRGV) (Formerly University of Texas-Pan American) - College of Business and Entrepreneurship

Christos Pantzalis

University of South Florida

Jung Chul Park

University of South Florida

Date Written: July 25, 2018

Abstract

We assess whether observable corporate political strategies can serve as channels of value-relevant political information flow into stock prices and form the basis for profitable return predictability strategies. We document that returns of politically connected firms’ stocks lead those of their non-connected peers, suggesting that information shocks associated with new policies and other political developments become evident first in the stock prices of firms that pursue political strategies and then, with delay, in those of similar non-connected firms.

Keywords: Political Connections, Boards With Ex-Politicians, Campaign Contributions, Lobbying Activities, Return Predictability

JEL Classification: G1, H1

Suggested Citation

Kim, Chansog (Francis) and Kim, Incheol and Pantzalis, Christos and Park, Jung Chul, Corporate Political Strategies and Return Predictability (July 25, 2018). Financial Analysts Journal, Forthcoming. Available at SSRN: https://ssrn.com/abstract=3219970

Chansog (Francis) Kim

The State University of New York at Stony Brook ( email )

College of Business
Stony Brook, NY 11794
United States
5163040037 (Phone)
631-632-9412 (Fax)

Incheol Kim

University of Texas Rio Grande Valley (UTRGV) (Formerly University of Texas-Pan American) - College of Business and Entrepreneurship ( email )

1201 W University Dr
Edinburg, TX 78539
United States

Christos Pantzalis

University of South Florida ( email )

Tampa, FL 33620-5500
United States
(813) 974-3262 (Phone)

Jung Chul Park (Contact Author)

University of South Florida ( email )

Tampa, FL 33620
United States
813-974-9680 (Phone)
813-974-3084 (Fax)

HOME PAGE: http://www.usf.edu/business/contacts/park-jung-chul.aspx

Register to save articles to
your library

Register

Paper statistics

Downloads
56
Abstract Views
600
rank
363,986
PlumX Metrics