Betting on the Market: The Influence of Match-Day Odds on Price Reactions of European Football Clubs

This research investigates the relationship between football match outcomes, betting odds and the stock prices of publicly traded European football clubs, spanning from 11 February 2004 to 7 April 2022. Drawing data from 12 major European and publicly traded clubs, the study utilised betting odds as a key metric. These odds, aggregated from the Odds Portal, serve as a gauge for expected versus unexpected match outcomes. Preliminary findings showed a market value increase of 0.44% after a win and a decrease of 1.08% post-defeat. Moreover, deviations from betting odds predictions significantly influenced stock prices, with unexpected wins and losses resulting in a 2.27% increase and 1.35% decrease, respectively. The temporal dimension of matches revealed differential stock price reactions based on the match’s placement within the season. Additionally, National League games, due to their economic implications, showcased a distinct impact on stock prices compared to Cup games. This study accentuates the instrumental role of betting odds in interpreting the interplay between football outcomes and stock market dynamics, enhancing our comprehension of capital market efficiency. The results suggest that the capital market efficiently takes into account the published betting odds.