In this project report you can learn about variables which result in corporate spinoffs along with the short and medium term risk and return which corporate spinoffs yield. A spin-off or a starburst is a type of corporate action where a company “splits off” sections of itself as a separate business. Some topics discussed in this project are: portfolio theory, capital asset pricing model, risk and return relation, post-spinoff, etc.
A well-known study, much like ours, was made in 1985 in the united states, demonstrating that “loser” portfolios outperformed the market while “winner” portfolios generated less return than the market. This finding isn’t according to the theory of efficient markets. If a