Finance and Financial Management Commons^™

Bio-Bust: Investigating Biotech Stock Factors Contributing To Abnormal Returns In The Wake Of Silicon Valley Bank's Failure, Spencer Kent

CMC Senior Theses

Following the unprecedented collapse of Silicon Valley Bank (SVB) in March 2023, this study explores abnormal stock price reactions within the biotechnology sector. As the chosen financial institution for countless Silicon Valley-type technology and healthcare firms, SVB's failure had a profound impact on small to mid-sized biotech companies. Analyzing a dataset of 180 biotech firms during a two-day event window over SVB’s collapse, I investigate whether exposure to SVB, or other factors, was the primary contributor to negative abnormal stock price reactions, considering variables such as the percentage of cash held at SVB, whether a firm maintained an active SVB …

Ai-Nvesting: An Empirical Analysis With Sector Categorization And Prompt Complexity Considerations Assessing The Predictive Power Of Chatgpt In Stock Market Forecasting, Ian J. Larson

CMC Senior Theses

Abstract

This paper investigates whether ChatGPT has any predictive power when it comes to the stock market. Since its public release in December 2022, OpenAI’s ChatGPT has become a popular tool for millions of users across the world. With new use cases being found every day, I explore whether the system has any utility at predicting where stock prices will go. Using a 10-year study window, I prompt ChatGPT to give U.S. equity picks on a one-year holding period basis, segregating its picks into 3 different category sizes across 8 directed prompts. I examine the 24 equal weight portfolios of …

The Impact Of Wars On Us Defense Stock Returns, Viksit Verma

CMC Senior Theses

This thesis examines the financial performance and market impact of defense and aerospace companies during periods of war and conflict. The study examines a sample of 9 firms representing the defense sector, and utilizes an event study methodology to assess stock returns during specific geopolitical events, namely the Russia-Ukraine War and the Israel-Hamas conflict. The study generally reveals positive abnormal returns during conflicts, indicating lower volatility and reduced market risk for the sample of defense firms compared to the broader market. All abnormal returns are statistically significant for the Russia-Ukraine War. For the Israel-Hamas conflict, abnormal returns for 4 out …

Nfl Positional Value In Terms Of Salary Cap Spending: Why Are Running Backs Undervalued?, Charlton Jackson

CMC Senior Theses

Running Backs over the past two decades have seen a contract value devaluation relative to other positions and the league's salary cap spending limit. The growth of running back salaries has stagnated in the past decade, and they currently fail to keep pace with the contracts for other positions. Through our empirical research, we were able to either reject or better explain existing reasoning for recent running back devaluation, such as the increase in passing volume, durability concerns, and running backs by committee. We found that the most significant change in the past 30 years of the NFL, since the …

Ceo Characteristics That Lead To Extreme Outperformance: A Statistical Analysis Of William Thorndike’S “The Outsiders”, William Turner

CMC Senior Theses

What makes a high-performing CEO? What CEOs should you invest in? These are the questions that the Board of Directors, headhunters, academics, and investors all seek the answer to. This paper explores the answer to this question by examining CEO performance at the extremes. Inspired by the work of William N. Thorndike’s “The Outsiders: Eight Unconventional CEOs and Their Radically Rational Blueprint for Success,” this study expands upon his methodology, employing a statistical approach to analyze a broader dataset of CEOs over the past thirty years. Using a logit model of hyper-outperforming versus hyper-underperforming CEOs, it assesses the …

Activism Aftershocks: Looking Beyond The Short-Term Stock Surges Caused By Activist Hedge Fund Campaign Announcements, Zara Vakath

CMC Senior Theses

It is well known that firms targeted by activist hedge funds experience positive abnormal stock returns during the campaign announcement window. However, the link between these short-term returns and the impact to long-term target firm performance has not been established. In this study, I find essentially no link between the positive announcement window returns and long-term performance improvements, using a variety of different methods. I examine performance changes over time and also relative to a matched sample of firms that have not been targeted by activist hedge funds. Additionally, I assess the correlation between the magnitude of short-term abnormal stock …