Comparing the price of sin

Abnormal returns of cross-listed casino gaming stocks in the Hong Kong and US markets

Research output: Contribution to journalArticle

4 Citations (Scopus)

Abstract

While a number of hospitality researchers have investigated hospitality stock returns, few examine the stock returns of casino gaming companies. In finance, these stocks are often termed as 'sin' stocks. The purpose of this study is to compare the stock returns of cross-listed casino gaming stocks in Hong Kong and New York stock exchanges. Four pairs of casino gaming stocks are currently cross-listed in both exchanges, allowing for comparison. The cross-listing sample consists of 3138 firm-day observations from January 2009 to December 2013. Preliminary analyses, using time-series regression, show that the average daily returns and standard deviations of casino gaming stocks are much higher than market indices in both jurisdictions. Most importantly, casino gaming stocks listed in Hong Kong exchange have a significantly higher abnormal return than their cross-listed counterparts in the US. The reason may be due to cultural issues. These findings will have meaningful implications to investors of casino gaming companies.

Original languageEnglish
Pages (from-to)73-76
Number of pages4
JournalInternational Journal of Hospitality Management
Volume45
DOIs
Publication statusPublished - 2015 Feb 1
Externally publishedYes

Fingerprint

finance
time series
market
firm
price
index
jurisdiction
comparison
Hong Kong
Abnormal returns
Gaming
Casino
Stock returns
Hospitality

Keywords

  • Casino gaming
  • Hong Kong
  • Sin stocks
  • USA

ASJC Scopus subject areas

  • Tourism, Leisure and Hospitality Management
  • Strategy and Management

Cite this

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abstract = "While a number of hospitality researchers have investigated hospitality stock returns, few examine the stock returns of casino gaming companies. In finance, these stocks are often termed as 'sin' stocks. The purpose of this study is to compare the stock returns of cross-listed casino gaming stocks in Hong Kong and New York stock exchanges. Four pairs of casino gaming stocks are currently cross-listed in both exchanges, allowing for comparison. The cross-listing sample consists of 3138 firm-day observations from January 2009 to December 2013. Preliminary analyses, using time-series regression, show that the average daily returns and standard deviations of casino gaming stocks are much higher than market indices in both jurisdictions. Most importantly, casino gaming stocks listed in Hong Kong exchange have a significantly higher abnormal return than their cross-listed counterparts in the US. The reason may be due to cultural issues. These findings will have meaningful implications to investors of casino gaming companies.",
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