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TIJSKENS_22131900_2024.pdf
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- Abstract
- This research investigates the intersection of football betting odds and stock market fluctuations, prompted by the lack of interconnectedness between the widely watched sport of football and the surging financial markets. Focused on "Trading on Football Bets", this study explores the potential correlation between a football club's match probabilities and its impact on share values. Building upon existing literature exploring financial aspects of football, particularly regarding club public offerings, our study emphasizes the coexistence of winning and profit maximization objectives within football clubs. Drawing insights from prior research on Italian clubs, our approach aims to construct predictive models correlating football match odds with stock price fluctuations of European Football Clubs. This examination concentrates on top European leagues, employing a selection criterion encompassing clubs from the top ten UEFA-ranked championships. The fundamental research question driving this inquiry is: "How can football betting odds, among other variables, enable the prediction of fluctuations in European football club stock markets?" Methodologically, our study employs statistical analysis to create models integrating European sporting and macroeconomic variables to explain daily share price variations. Despite several attempts to refine predictor variables, the best model yielded an R-squared value of approximately 0.25, indicating limited explanatory power for daily share price variations.