Effect of COVID-19 on US TV Stocks Based on Fama-French Model Analysis

Abstract

The COVID-19 has become a global crisis since it broke out at the beginning of 2020, which has led to a global economic recession and a deep influence on the stock market. This research adopted the Fama-French model to analyze the impact of the epidemic on the listed TV companies' stock in the US stock market. The research data was consulted from the CRSP database with the factors of the Fama-French model and the value & equal-weighted returns for 38 industry portfolios in the US market. The research selected the data above from April 1, 2019, to January 29, 2021 and chose March 1 as the date of the outbreak of the epidemic in the US, which represented the timeline before and after COVID19. After multiple linear regression, it was found that COVID-19 has had a significant effect on the TV industry. The analysis of five factors concluded that the market preference shows the following characteristics: value stock, high profitability, and aggressive investment style. It is recommended that the investors who want to invest in the TV industry in the US stock market can take the stocks with the above features as the investment targets in the post-epidemic period, and this theory can also be applied to future investment whenever an analogous event happens.