Stock performance of companies with superior and inferior practices of corporate governance

  • Sérgio Soares Teixeira Rabelo UFU
  • Pablo Rogers Universidade Federal de Viçosa
  • Kárem Cristina de Sousa Ribeiro UFU; FAGEN
  • José Roberto Securato USP; FEA
Keywords: Corporative Governance, Portfolio Study, Sharpe Index

Abstract

For investors who own stock portfolios, a healthier business climate brought about by superior corporate governance may better safeguard investments. An investigation was made to determine if a portfolio of stocks of companies with superior corporate governance (Type I) had a better performance than one of companies with inferior governance (Type II). Randomly assembled portfolios were evaluated by the Sharpe Index (IS) and showed that the Type I portfolio had a higher IS and a higher probability of return above the SELIC rate, 56.49%, than the Type II portfolio where this probability was less, 55.20%. Although not highly significant, results pointed to an advantage for the stock portfolio of companies with the superior corporate governance

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Published
2007-01-01
How to Cite
Rabelo, S., Rogers, P., Ribeiro, K., & Securato, J. (2007). Stock performance of companies with superior and inferior practices of corporate governance . REGE Revista De Gestão, 14(spe), 1-16. https://doi.org/10.5700/issn.2177-8736.rege.2007.36578
Section
Finanças