CEO OWNERSHIP AND STOCK RETURNS: EVIDENCE FROM NASDAQ STOCKHOLM LARGE CAP

Abstract

This thesis asks whether CEO equity ownership is associated with excess stock returns among firms listed on Nasdaq Stockholm Large Cap during Q1 2020–Q4 2025. Using a quarterly panel of 166 firms and 2,899 firm-quarter observations, we sort firms into four CEO-ownership quartiles each quarter based on their CEO's active ownership share and compare returns in the highest (Q4) and lowest (Q1) quartiles using equal-weighted spreads, SIXRX-adjusted returns, value-weighted portfolios, and sector-controlled specifications. The highest-ownership quartile outperforms the lowest by 1.53 pp per quarter in equal-weighted portfolios, but the spread is not statistically significant. The positive spread remains after sector adjustment, still insignificant, but reverses under both total-market-capitalisation and free-float weighting, suggesting that the equal-weighted result is not representative of a value-weighted investor's experience and is concentrated in smaller firms within the Large Cap segment. The pattern is non-uniform and regime-dependent. The spread is strongly positive in 2020–2021, coinciding with the strong performance of real-estate firms (which are disproportionately represented in the high-ownership quartile), but reverses in 2022–2025. Overall, the evidence does not provide statistically reliable support for a positive ownership-return association. The highest-ownership quartile is significant in a pooled panel, but not after a firm-size control.