How Football Matches Affect Abnormal Returns of European Publicly Traded Football Teams

Abstract: This paper applied a broader, more diverse dataset to investigate whether match results still lead to abnormal returns and to identify which match factors are the most influential. Abnormal returns were measured using the market model and event studies for 23 teams during the 2016-2019 seasons. We confirmed that victories result in positive abnormal returns of 0.39% and draws/losses lead to negative abnormal returns of -0.29% and -1.0% respectively. The degree of these abnormal returns varied depending on factors such as match location, team ranking within their league, whether teams were on a win streak, and betting odds. The greatest abnormal returns equaling 1.46% were observed when a team was victorious winning against betting odds, while the greatest negative abnormal return of -2.35% was observed when a team lost to a team of lower ranking within their league.