The Impact of Covid-19 on Football Club Stock Integration and Portfolio Diversification
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Ali Aboudi Nehme ; Anwar Mustafa Hasan ; Akram Salim H. Al-Janabi ; Ghazwan Ayad Khalid Al-Shiblawi ; Mazen Dawood Salman ; Hala Ayyed Hadi ; Mohammed Faez Hasan ; Al-Taie, Ahmed Hafedh Hameed ; Al-taie, Bushra Fadhil Khudhair ; Ali, Sallama Ibrahim ; Zghair, Nawfal Ghazi ; Maseer, Rabab Wahhab ; Flayyih, Hakeem Hammood [1] ; Hussein, Mustafa Khudhair ; Al-Saedi, Ali H. ; Al-Ibraheemi, Salam Abdul Rahman A.A. ; Jawad, Karrar Kareem
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[1] University of Baghdad
University of Baghdad
Irak
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- Localización: Revista iberoamericana de psicología del ejercicio y el deporte, ISSN 1886-8576, Vol. 18, Nº. 5, 2023, págs. 562-567
- Idioma: inglés
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Resumen
This paper investigates the impact of the COVID-19 pandemic on the integration and diversification potential of European football club stocks. Football clubs represent a unique asset class with ties to geographic regions yet distinct brand identities. Using stock data for 14 major clubs before and after March 2020, we examine how COVID-19 altered correlations between equities. We find increased market synchronization, with higher correlations over 0.3 post-pandemic, indicating tighter relationships especially along country/league lines. However, some differentiation based on firm-specific factors persists. Our analysis shows constructing optimized portfolios can still enhance returns versus equal weighting, but managing risk is more difficult. Overall, while COVID-19 integration presents diversification challenges, opportunities remain by carefully selecting assets with moderate correlations. This study provides investors and academics insight into how a major crisis reshapes football stock dynamics, increasing systematic risk exposure. It highlights the need to reevaluate assumptions underlying portfolio construction in light of shifting correlations.
