Sector index returns and the market: An examination of the pre-and post-crash periods

Bradley T. Ewing, Farooq Malik

Research output: Contribution to journalArticlepeer-review

2 Scopus citations

Abstract

Reliance on stock market sector indexes for investment makes it essential to understand how various sectors behave relative to the market. Of particular importance is whether these relationships have changed over time. This paper examines the risk/return characteristics of five S&P sector indexes in pre-and post-1987 stock market crash periods. The results suggest that, relative to the market, the volatility of some sectors may change following major events. Index investing should not be thought of as a totally passive strategy. In light of these changing relationships, financial planners should make sure clients revisit investments, especially following major economic events.

Original languageEnglish
Pages (from-to)85-89
Number of pages5
JournalJournal of Financial Counseling and Planning
Volume11
Issue number2
StatePublished - 2000

Keywords

  • Financial planning
  • Household portfolios
  • Index funds
  • Investment
  • Risk
  • Stocks

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