Returns to investors in stocks in new industries

Cora Barnhart and Gerald Dwyer

No 2008-21, FRB Atlanta Working Paper from Federal Reserve Bank of Atlanta

Abstract: We examine the returns to investors in publicly traded stock in new industries. We examine data from the United States on sellers of own-brand personal computers, airlines and airplane manufacturers, automobile manufacturers, railroads, and telegraphs. We find that a relatively small number of companies generate outstanding returns and many firms fail. Firms in new industries typically have high volatility of individual stocks' returns. Compared with indexes for the same period, expected returns of firms are higher for two industries, lower for one industry and roughly the same for two industries. Portfolios of firms in new industries generally have lower Sharpe ratios than the overall market.

Keywords: Investments (search for similar items in EconPapers)
Date: 2008
New Economics Papers: this item is included in nep-rmg
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Related works:
Journal Article: RETURNS TO INVESTORS IN STOCKS IN NEW INDUSTRIES (2012)
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