Date of Award


Document Type

Honors Thesis

Degree Name

Bachelor of Arts




This paper explores the effects of rumors on stock prices. It targets publicly traded soccer teams to see what impact rumors of players transferring, in and out of teams, has on their respective stock returns. A total of 56 rumors are being used in the analysis. An event study is conducted around the dates of each transfer rumor in order to examine what types of abnormalities exist in the returns of the stock. To further investigate this study, a cross sectional analysis is being performed to see whether player reputation, player status, and future validity of the rumors had more of an effect on the stock’s returns. My statistical analysis indicates that abnormal market returns occur with strong statistical significance between 3 and 1 day before the publication of the transfer rumors in the sample. Univariate tests show no statistical significance in any of the cross sectional analyses performed. A regression controlling for each factor, in addition to the team’s ranking, also showed no statistical significance. Market value, used as a control variable for a player’s popularity in the regression analysis, was found to have a statistically significant relationship with abnormal returns.

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