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dc.contributor.advisorFjesme, Sturla
dc.contributor.authorAndersen, Sofie Lødeng
dc.contributor.authorØdegaard, Line Christina Kragebøl
dc.date.accessioned2019-05-09T07:47:42Z
dc.date.available2019-05-09T07:47:42Z
dc.date.issued2018
dc.identifier.urihttps://hdl.handle.net/10642/7027
dc.descriptionMaster i økonomi og administrasjonen
dc.description.abstractChanges in political leadership influence the economic policy of government, which directly impacts on firms. Accordingly, the risk-adjusted market return alters, as investors reallocate their investments. We apply common financial methodologies in investigating how the election of Donald Trump affects the U.S stock market. Utilizing the Fama and French three-factor model, and the Jensen’s alpha approach, we find no evidence of abnormal returns from Trump’s presidency. However, we find that a portfolio consisting of the health care sector, the defense sector, and the flight-travel sector generates negative abnormal returns during the Bush – and Obama presidential periods. Correspondingly, we reject that the election of Donald Trump negatively affects the combined portfolio, as the portfolio performs much worse with Bush and Obama as presidents. Furthermore, we find evidence that the health care sector, the defense sector, and the flight-travel sector possess a sufficiently higher risk-adjusted performance with Trump as president, compared to Bush and Obama based on Sharpe ratio estimation. Controlling for political party, the results do not support that Trump’s effect on the U.S. stock market is related to his republican policies. We conclude that the election of Donald Trump increases the performance for the sector portfolios compared to the Bush – and Obama presidential periods.en
dc.language.isoenen
dc.publisherOsloMet - Oslo Metropolitan Universityen
dc.subjectVDP::Samfunnsvitenskap: 200::Økonomi: 210::Samfunnsøkonomi: 212en
dc.subjectVDP::Samfunnsvitenskap: 200::Statsvitenskap og organisasjonsteori: 240::Offentlig og privat administrasjon: 242en
dc.subjectPolitical leadershipen
dc.subjectFinancial marketsen
dc.subjectU.S. stock marketsen
dc.subjectTrump, Donalden
dc.subjectAbnormal returnsen
dc.subjectElectionsen
dc.titleHow are Financial Markets affected by the Election of Donald Trump? An Event Study on the U.S Stock Market’s Response to Changes in Political Leadershipen
dc.typeMaster thesisen
dc.description.versionpublishedVersionen


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