In the text it was noted that the BHAR approach in long-run event studies is vulnerable to

Question:

In the text it was noted that the BHAR approach in long-run event studies is vulnerable to cross-sectional correlation. Is it vulnerable to autocorrelation or heteroskedasticity of the returns too?

Fantastic news! We've Found the answer you've been seeking!

Step by Step Answer:

Related Book For book-img-for-question

Investment Valuation And Asset Pricing Models And Methods

ISBN: 9783031167836

1st Edition

Authors: James W. Kolari, Seppo Pynnönen

See More Books

Question Posted: Mar 05, 2024 06:00 AM

See More Questions

SOLEX ENGINEERING ENTERPRISE (SEE) The company: Solex Engineering Enterprise (SEE) is a Sri Lankan organization formed as a partnership by two brothers in 1980. They had a keen interest to explore...
After the Internet investment bubble burst, the original concept of easyInternetcaf? (eIc) was just not working out. The management decided to retrench, closing and downsizing some of the original...
In the text it was stated that when a mobile host is not at home, packets sent to its home LAN are intercepted by its home agent on that LAN. For an IP network on an 802.3 LAN, how does the home...
On January 1, 2011, M Company granted 98,000 stock options to certain executives. The options are exercisable no sooner than December 31, 2013 and expire on January 1, 2017. Each option can be...
Briefly explain whether you agree with the following statement: "I recently read that more than half of the money the government prints is actually held by people in foreign countries. If that's...
Map the recursive relationship shown in Figure 8.14 to a relational database and show some sample data.
7. Let a, b, c, D, E be real numbers with c =I- O. (a) If DE > 0, find all extrema of ax + by + cz subject to the constraint z = Dx2 + Ey2. Prove that a maximum occurs when cD < 0 and a minimum when...
What are the advantages and disadvantages of using labor utilization as a performance measure? Do these same arguments apply to machine utilization?
As a young person freshly graduated from college, one is often facing this question. Use this forum to share your thoughts and learn from others'. Sam is a newly graduate student. He is weighing on...
Reconsider the Goferbroke Co. prototype example, including its analysis in Sec. 16.3. With the help of a consulting geologist, some historical data have been obtained that provide more precise...
Consider a long-run event study of SEO events with abnormal returns defined as the difference between the returns of the event firm and its matched control firm. What would you consider to be a major...
Suppose that you want to test the null hypothesis of no mean effect when event days are completely clustered. The sample size is n = 100 firms and the test statistic applied is BMP due to its good...
Annie runs a fitness center. On December 31, 2011, she bought an existing business with exercise equipment and a building worth $300,000. During 2012, business improved and she bought some new...
What Do You Know About Amazon Associate Program? What Would You Do To Increase Your Earnings With Amazon Associate Program? Is Affiliate Marketing And Referral Marketing One And The Same? What is...
As a leader, what do you think are important elements of a leadership team made up of those senior people that you will surround yourself with? Do you have (or have you had) a mentor? If so, how have...
What role do interorganizational relationships and alliances play in achieving strategic goals, and how do organizations manage these relationships to ensure mutual benefit and minimize risks ?
How do expatriate managers normally rotate into the operations of a foreign country? How long do they typically stay in the country? What are the disadvantages? How did Shane Tedjarati rotate into...
If you are not Asian, do you know someone well who is Asian? In what capacity do you know them (e.g., personal friend, manager, classmate, neighbor, etc.)? Do you know their ethnic origin (e.g.,...
A business student has $ 2,500 available from a summer job and has identified three potential stocks in which to invest. The cost per share and expected return over the next 2 years is given in the...
Difference between truncate & delete
Atlantis Fisheries issues zero coupon bonds on the market at a price of $417 per bond. Each bond has a face value of $1,000 payable at maturity in 20 years. What is the yield to maturity for these...
May Industries has a bond outstanding that sells for $928. The bond has a coupon rate of 7.5 percent and nine years until maturity. What is the yield to maturity of the bond?
A bond with a maturity of 12 years sells for $1,047. If the coupon rate is 8.2 percent, what is the yield to maturity of the bond?
Simpson Ltd is a small IT company, which has 2 million shares outstanding and a share price of $20 per share. The management of Simpson plans to increase debt and suggests it will generate $3 million...
The following are the information of Chun Equipment Company for Year 2 . ( Hint: Some of the items will not appear on either statement, and ending retained earnings must be calculated. ) Salaries...
Alta Ski Company's inventory records contained the following information regarding its latest ski model. The company uses a periodic inventory system. Beginning inventory, January 1, 2018 1,250 units...

In the text it was noted that the BHAR approach in long-run event studies is vulnerable to

Question:

Step by Step Answer:

In longrun event studies the BuyandHold Abnormal Returns BHAR approach is indeed vulnerable to various statistical issues including crosssectional cor...View the full answer

Investment Valuation And Asset Pricing Models And Methods

Students also viewed these Business questions