Nr. 16/2006

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Frequent News and Pure Signals

The Case of a Publicly Traded Football Club

Georg Stadtmann

September 2005


We use stock market data for Borussia Dortmund GmbH & Co. KGaA – one of the leading German football clubs – for an application of the news model. Due to the specific characteristics of the news generating process, the case of a publicly traded sport club is a very appropriate candidate for testing this model. By applying a traditional as well as a reversed news model we elaborate whether new information can explain subsequent changes in the stock price of Borussia Dortmund. We find that sport as well as corporate governance related variables are important drivers of the stock price.


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