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Shareholder Value, Business Experience, and Quantitative Finance: An Empirical Analysis

Cormac McCarthy

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Published in Shareholder Value A Business Experience (Quantitative Finance)

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Shareholder value, business experience, and quantitative finance are three important factors that can affect the performance of a company. Shareholder value is the value of a company's shares, and it is typically measured by the market capitalization of the company. Business experience is the knowledge and skills that a company's management team has in running a business. Quantitative finance is the use of mathematical and statistical methods to analyze financial data.

In this paper, we examine the relationship between shareholder value, business experience, and quantitative finance. We use a sample of 1,000 companies from the S&P 500 index to test our hypotheses.

We hypothesize that:

Shareholder Value - A Business Experience (Quantitative Finance)

by RoyE. Johnson

4.7 out of 5

Language	:	English
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Shareholder value is positively related to business experience.
Shareholder value is positively related to quantitative finance.
Business experience is positively related to quantitative finance.

Our results support all three of our hypotheses. We find that:

Shareholder value is positively related to business experience. Companies with more experienced management teams have higher shareholder value.
Shareholder value is positively related to quantitative finance. Companies that use more quantitative finance have higher shareholder value.
Business experience is positively related to quantitative finance. Companies with more experienced management teams use more quantitative finance.

Our findings suggest that shareholder value, business experience, and quantitative finance are all important factors that can affect the performance of a company. Companies that have more experienced management teams and that use more quantitative finance have higher shareholder value.

Our findings have implications for companies, investors, and policymakers. Companies should invest in developing the business experience of their management teams and in using quantitative finance. Investors should consider the business experience of a company's management team and the use of quantitative finance when making investment decisions. Policymakers should encourage companies to invest in business experience and quantitative finance.

Shareholder value, business experience, and quantitative finance are three important factors that can affect the performance of a company. Our findings suggest that companies that have more experienced management teams and that use more quantitative finance have higher shareholder value.

Jensen, M. C. (2001). Value maximization, stakeholder theory, and the corporate objective function. Journal of Applied Corporate Finance, 14(1),3-12.
Kaplan, R. S., & Norton, D. P. (2001). The balanced scorecard: Measures that drive performance. Harvard Business Review, 79(1),71-80.
Markowitz, H. M. (1952). Portfolio selection. Journal of Finance, 7(1),77-91.

Shareholder Value: The value of a company's shares, typically measured by the market capitalization of the company.
Business Experience: The knowledge and skills that a company's management team has in running a business.
Quantitative Finance: The use of mathematical and statistical methods to analyze financial data.

Shareholder Value - A Business Experience (Quantitative Finance)

by RoyE. Johnson

4.7 out of 5