ISSN: 2225-8329
Open access
This study aims to see the impact of the implementation of Asian games 2018 event towards stock price movement. This study tested the occurrence of market reaction before and after the implementation of Asian games 2018 event. This study is an event study using explanatory methodology with quantitative approach. The population that is used in this study is companies that are listed on Indonesia Stock Exchange. Samples that are used in this study are 45 companies indexed by LQ45. Data sources that are used are from Indonesia Stock Exchange which is IDX Composite and Closing price one week before and one week after Asian Games 2018. Hypothesis is tested using Paired Sample T-Test to see the difference of abnormal return before and after Asian games 2018 for both winner stock portfolio and loser stock portfolio. The result of this study shows that market overreaction does not occur. Loser stock portfolio does not sustain price reversal to turn into winner stock portfolio and vice versa. This indicates that there is no anomaly occurs in efficient market over the event, winner stock remains to be winner stock and loser stock remains to be loser stock.
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To cite this article: Praditha, R., Haliah, Habbe, A. H., Rura, Y. (2019). Market overreaction on LQ45 stock index before and after Asian Games 2018, International Journal of Academic Research in Accounting, Finance and Management Sciences 9 (2): 117-125.
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