Faculty Publications

A Note On Assessing The Relation Between Ceo Characteristics And Stock Performance: Alpha Above Replacement

Document Type

Article

Keywords

Abnormal returns, Alpha, Chief executive officer, Stock performance

Journal/Book/Conference Title

Accounting and Finance

Volume

56

Issue

3

First Page

787

Last Page

802

Abstract

Many studies examine the relation between stock performance and CEO characteristics. We approach the topic in a different way, using the alphas generated by the Fama-French three-factor model as the dependent variable in a CEO characteristic model. We find several traits are significantly related to alpha. CEOs who are younger, own a larger fraction of firm equity and hold a graduate degree provide greater alphas. CEOs who are also the founder of the firm deliver larger alphas. Our results provide useful information for boards assessing the performance of CEOs and considering CEO succession.

Original Publication Date

9-1-2016

DOI of published version

10.1111/acfi.12095

Repository

UNI ScholarWorks, Rod Library, University of Northern Iowa

Language

en

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