How are sponsors' share returns in Formula 1 affected by race wins?
(2022) NEKH02 20221Department of Economics
- Abstract
- This paper examines abnormal returns for sponsors of race-winning Formula 1 teams through an event study. Abnormal returns are analyzed from the hybrid era 2014-2021 for 12 different sponsors whose logo is on the car's chassis through an event study. Petronas, Mercedes' main sponsor, is the sponsor that won by far the most Formula 1 races during this period. The Constant Return Model gives us the highest cumulative average abnormal return of 0.176%. The Market-Adjusted Model gives us a CAAR of 0.089% and the Capital Asset Pricing Model gives us a CAAR of 0.085%. None of the models show any major significant results that a Formula 1 win would have any large effect on a sponsor share price.
Please use this url to cite or link to this publication:
http://lup.lub.lu.se/student-papers/record/9102007
- author
- Karafiloski, Alexandro LU
- supervisor
- organization
- course
- NEKH02 20221
- year
- 2022
- type
- M2 - Bachelor Degree
- subject
- keywords
- Formula 1, Sponsors, Event Study, Abnormal Returns, Cumulative Average Abnormal Returns
- language
- English
- id
- 9102007
- date added to LUP
- 2022-11-29 15:14:01
- date last changed
- 2022-11-29 15:14:01
@misc{9102007, abstract = {{This paper examines abnormal returns for sponsors of race-winning Formula 1 teams through an event study. Abnormal returns are analyzed from the hybrid era 2014-2021 for 12 different sponsors whose logo is on the car's chassis through an event study. Petronas, Mercedes' main sponsor, is the sponsor that won by far the most Formula 1 races during this period. The Constant Return Model gives us the highest cumulative average abnormal return of 0.176%. The Market-Adjusted Model gives us a CAAR of 0.089% and the Capital Asset Pricing Model gives us a CAAR of 0.085%. None of the models show any major significant results that a Formula 1 win would have any large effect on a sponsor share price.}}, author = {{Karafiloski, Alexandro}}, language = {{eng}}, note = {{Student Paper}}, title = {{How are sponsors' share returns in Formula 1 affected by race wins?}}, year = {{2022}}, }