Price fairness: Clean energy stocks and the overall market

This study analyzes the current status and potential of clean energy stocks compared with the overall stock market index, particularly in terms of market efficiency and information flow. We find that despite its low liquidity, the market for clean energy stocks is weak-form efficient and exhibits a...

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Bibliographic Details
Published in:Chaos, solitons and fractals solitons and fractals, 2023-03, Vol.168, p.113049, Article 113049
Main Authors: Choi, Gahyun, Park, Kwangyeol, Yi, Eojin, Ahn, Kwangwon
Format: Article
Language:English
Subjects:
Clean energy
Environmental, social, and governance
Information flow
Market efficiency
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Summary:This study analyzes the current status and potential of clean energy stocks compared with the overall stock market index, particularly in terms of market efficiency and information flow. We find that despite its low liquidity, the market for clean energy stocks is weak-form efficient and exhibits a significant information outflow toward the market index. Considering the short run integration between the two markets and the recent growth in clean energy investment, we conclude that the clean energy stock market is reaching parity in terms of price fairness and information discovery. Our findings suggest that clean energy stocks can be used as a tool to monitor changes in eco-friendly energy policies for various stakeholders.
ISSN:0960-0779
DOI:10.1016/j.chaos.2022.113049