Economics, Econometrics and Finance
4 years ago

Size Doesn't Matter: European Equity Market Study Challenges Investment Wisdom

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Accounting and Finance Research
The Small-Sized Premium: Is It Really Relevant? Evidence from the European Equity Market
Renato Salvatore Camodeca, Christian Prinoth, Umberto Sagliaschi

Paper Summary

The article investigates if the size of a company affects how much investors expect to earn from investing in it. Instead of looking at past data, the researchers use a new method to estimate the cost of investing in companies based on their size and other factors. They study European companies after the 2008 financial crisis and find that the size of a company does not significantly impact the cost of investing in it.

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