Relationship between Crude Oil Prices and Stock Prices of Alternative Energy Companies with Recent Evidence

Alex Huang (), Chiao-Ming Cheng (), Wen-Cheng Hu () and Chih-Chun Chen ()
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Chiao-Ming Cheng: College of Management, Yuan Ze University
Wen-Cheng Hu: College of Management, Yuan Ze University
Chih-Chun Chen: Department of Management, Fo Guang University

Economics Bulletin, 2011, vol. 31, issue 3, 2434-2443

Abstract: This paper examines the recent interactive relationships between crude oil prices and stock performances of alternative energy companies. Oil prices and stock index of alternative energy sector are found independent from each other before late 2006. Contrary to existing studies, however, we find significant interdependence between oil prices and stock index of alternative energy industry in the recent years. Since late 2006, oil prices become significantly responsible for the stock performances of alternative energy companies. This finding suggests that the stock market investors of alternative energy sector incorporate oil price shocks into their trading decisions only recently.

Keywords: Crude oil price; Alternative energy; Oil stock index (search for similar items in EconPapers)
JEL-codes: F2 Q4 (search for similar items in EconPapers)
Date: 2011-08-29
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Citations: View citations in EconPapers (6)

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