ANALYSIS OF THE RELATIONSHIP BETWEEN NOTIFICATIONS OF FOOTBALL CLUBS AND STOCK RETURNS USING EVENT STUDY METHOD

Year 2021, Volume: 21 Issue: 1, 66 - 75, 30.04.2021

Mesut Doğan , Mustafa Kevser , Sevgi Sumerli Sarıgül

https://doi.org/10.30976/susead.890430

Cited By: 4

Abstract

Purpose - The purpose of this study is to examine the effect of the Public Disclosure Platform (KAP) notifications of Beşiktaş, Galatasaray, Fenerbahçe and Trabzonspor clubs on stock returns. Methodology – In the study, the transfer meeting announcements of football clubs, the positive results of the transfer negotiations and the dates of the sponsorship agreement were evaluated as notification dates. In the research, the data of 2009-2010/2019-2020 seasons were used and the changes in stock returns on (date) and afterwards were determined. However, due to the COVID-19 outbreak, the data included in 2020 were not analyzed. Findings – In the analysis, it is concluded that notifications related to football clubs provide extremely high returns from stocks, and the market is not effective. Conclusions – As a result of the notifications of important transfers to KAP, all news channels and newspapers give an important place to this notification. As a result of this situation, people can buy the stocks of their existing teams by not acting rationally and with the awareness of fans. Based on this, it is understood that the transfer news is effective for Turkish football clubs.

Keywords

football clubs, stock returns, event study

Project Number

Bulunmamaktadır.

Futbol Kulüplerinin Bildirimleri ile Hisse Senedi Getirileri Arasındaki İlişkinin Olay Analizi Yöntemi İle Analizi

Abstract

Purpose - The purpose of this study is to examine the effect of the Public Disclosure Platform (KAP) notifications of Beşiktaş, Galatasaray, Fenerbahçe and Trabzonspor clubs on stock returns.

Methodology – In the study, the transfer meeting announcements of football clubs, the positive results of the transfer negotiations and the dates of the sponsorship agreement were evaluated as notification dates. In the research, the data of 2009-2010/2019-2020 seasons were used and the changes in stock returns on (date) and afterwards were determined. However, due to the COVID-19 outbreak, the data included in 2020 were not analyzed.

Findings – In the analysis, it is concluded that notifications related to football clubs provide extremely high returns from stocks, and the market is not effective.

Conclusions – As a result of the notifications of important transfers to KAP, all news channels and newspapers give an important place to this notification. As a result of this situation, people can buy the stocks of their existing teams by not acting rationally and with the awareness of fans. Based on this, it is understood that the transfer news is effective for Turkish football clubs.

Keywords

Football clubs, Stock returns, Public disclosure platform, Event study, News

Supporting Institution

Bulunmamaktadır.

Project Number

Bulunmamaktadır.

References

• Akerlof, G. (1970). The market for lemons: quality uncertainty and the market mechanism. Quarterly Journal of Economics, 84, 488-500.
• Aygören, H., Uyar, S., Sarıtaş, H. (2008). Are investors influenced by the results of football matches? An empirical ınvestigation in İstanbul stock Exchange. Hacettepe University Journal of Economics and Administrative Sciences, 26 (1), 121–137.
• Babacan, B., Özer, G. (2014). Voluntary and mandatory transfer disclosures of football teams and behaviour of stock returns: An event study. International Review of Economics and Management, 2(1), 19-35.
• Beyaz, Z., Bakırtaş, İ. (2010). The effect of the football clubs performance on the stock returns. International Journal of Sport Research, 2 (2).
• Çatı, K., Eş, A., Özevin, O. (2017). Sportive and financial performance analysis of football team with entropi and topsis methods: An application on major Europe’s 5 leagues and Turkey League. Int. Journal of Management Economics and Business, 13(1), 199-222.
• Çörtük, O., Erten, M. (2016). The efficiency of public disclosure for capital markets in Turkey. Istanbul University Journal of the School of Business, 45(1), 65-77.
• Deloitte. (2020). Annual Review of Football Finance, Available at: https://www2.deloitte.com/uk/en/pages/sports-business-group/articles/annual-review-of-football-finance.html (02.11.2020).
• Devecioğlu, S. (2004). The relation between sports success and market price of sport clubs supply to public. Spormetre The Journal of Physical Education and Sport Sciences, 2 (1), 11–18.
• Diamond, D.W., Verrecchia, R.E. (1991). Disclosure, liquidity, and the cost of capital. The Journal of Finance, Avaliable at: https://doi.org/10.1111/j.1540-6261.1991.tb04620.x (05.11.2020)
• Dimitropoulos, P.E., Limperopoulos, V. (2014). Player contracts, athletic and financial performance of the Greek football clubs. Global Business and Economics Review, 16(2), 123-141.
• Eiata, J.H. (2012). Modelling macroeconomic determinants of stock market prices: Evidence from Namibia. The Journal of Applied Business Research, 28(5), 871-884.
• Eryiğit, C., Eryiğit, M. (2019). The effect of sponsorship announcements on stock returns of sponsees. International Journal of Sport Finance, 14(3), 173-190.
• Farquhar, S., Machold, S., Ahmed, P.K. (2005). Governance and football: An examination of the relevance of corporate governance regulations for the sports sector. International Journal of Business Governance and Ethics, 1(4), 329-349.
• Freitas, M.M., Farias, R.A.S., Flach, L. (2017). Efficiency determinants in Brazilian football clubs. Brazilian Business Review, 1-23.
• Gerrard, B. (2010). Analyzing sporting efficiency using standardized win cost: Evidence from the FA premier league, 1995–2007. International Journal of Sports Science and Coaching, 5(1), 13–35.
• Giulianotti, R., Robertson, R. (2004). The globalization of football: A study in the glocalization of the serious life. The British Journal of Sociology, 55(4), 545-568.
• Healy, M.P., Palepu, K.G. (1993). The effects of firms’ financial disclosure strategies on stock prices. American Accounting Association Accounting Horizons, 7 (1), 1-11.
• Healy, M.P, Hutton, A.P., Palepu, K.G. (1999). Stock performance and ıntermediation changes surrounding sustained ıncreases in disclosure. Contemporary Accounting Research, 16(3), 485-520.
• Hoffmann, R., Ging, L.C., Ramasamy, B. (2002). The socio-economic determinants of international soccer performance. Journal of Applied Economics, 5(2), 253-272, DOI: 10.1080/15140326.2002.12040579.
• Johnstone, M.A. (2010). The impact of sponsorship announcements on shareholder wealth in Australia. Asia Pacific Journal of Marketing and Logistics, 22(2), 156-178.
• Kudo, M., Ko, Y.J., Walker, M., Connaughton, D.P. (2015). The influence of title sponsorships in sports events on stock price returns. International Journal of Sports Marketing and Sponsorship, Research Paper.
• Müge, D. (2020). Industrial football and the use of technology in football. TRT Academy, 5(9), 356-375.
• Pamukçu, F. (2011). The importance of corporate governance in public disclosure and transparency by financial reporting. The Journal of Accounting and Finance, 50, 133-148.
• Pinnuck, M., Potter, B. (2006). Impact of on-field football success on the off-field financial performance of AFL football clubs. Accounting and Finance, 46, 499–517.
• Ratten, V. (2020), Football ecosystems and innovation, Ratten, V. (Ed.) Sport Startups: New Advances in Entrepreneurship, Emerald Publishing Limited, 71-87. https://doi.org/10.1108/978-1-78973-081-420201006
• Rezende, A.J., Dalmacio, F.Z., Facure, C.E.F. (2010). Practice of corporate governance in football clubs, International Journal of Economics and Accounting, 1(4), 410-447.
• Saatçioğlu, C., Çakmak, U.D. (2019). Football economy in Europe and Turkey: A comparative study. The Sakarya Journal of Economics, 8(4), 331-350.
• Sanju, P. S., Ramachandran, M., Nirmala, P.S. (2011). Determinants of share prices in India. Journal of Emerging Trends in Economics and Management Sciences, 2(2), 124-130.
• Sharif, T., Purohit, H., Pillai, R. (2015). Analysis of factors affecting share prices: The case of Bahrain stock Exchange. International Journal of Economics and Finance, 7(3), 207-216.
• CMB (Capital Markets Board) (2005). Corporate Governance Principles, Ankara, Turkey. Szymanski, S., Smith, R. (2010). The English football ındustry: Profit, performance and industrial structure. Football Economics and Policy, Palgrave Macmillan, USA. Temizel, F., Özata, E., Esen, E. (2013). The analysis of the relationship between spotive performances of the football teams and their stock returns: The Turkish case. TISK Akademi, 8(15), 178-197.
• Uddin, M. B. (2009). Determinants of market price of stock: A Study on bank leasing and ınsurance companies of Bangladesh. Journal of Modern Accounting and Auditing, S5(7): 1-7.
• Uludağ, B., Sigalı, S. (2013). Impact of sporting performance on financial performance: An analysis of 4 big soccer clubs in Turkey. Ege Academic Review, 16(4), 575-585.
• Wiseman, F., Sangit, C. (2003). Team payroll and team performance in major league baseball: 1985−2002. Economics Bulletin, 1(2), 1–10.
• Yenice, S., Dölen, T. (2013). The effect of harmonization to the principles of corporate governance on the firm value of publıcly-traded firm in ISE. Int. Journal of Management Economics and Business, 9(19), 199-214.
• Zeren, F., Gümüş, F. B. (2013). An application on performances of the Turkish and foreign football teams in their stock markets. Çankırı Karatekin University Journal of the Faculty of Economics and Administrative Sciences, 3 (2), 34–54.
• https://www.kap.org.tr/tr/menu-icerik/KAP-Hakkinda/Genel-Bilgi