This thesis analyzes the competitiveness of a Sport-Relations Investment Fund (SRIF) compared to top tier benchmark funds. The results show that 9 out of 10 SRIF portfolios are very competitive and 6 out of 10 portfolios show higher Sharpe ratios than any of the benchmarks during the period May 2013 to May 2015. The 85 assets comprising the SRIF portfolios were found in the sport network. All assets were selected based on our sports defining criteria and individual industry restrictions. This stock universe includes companies within sport apparel/equipment, sports betting, broadcasting, sport clubs etc. This broad range of companies has experienced tremendous growth during the last decade, a growth we will try to exploit through investment in the network. The sport network is characterized by its strong interdependency and loyalty, which makes it a robust investment, even during economic downturns. The growth in the sport network is a result of the great passion from fans, which has boosted revenue to such an extent that record breaking deals are realized in many parts of the network. The crucial question is therefore why no investment bank has created such a fund yet. Through our analysis we conclude that the unprofitability of sport clubs unfairly has given the sport network an economically bad reputation. In order to optimize the asset allocation process of SRIF, portfolio theory is applied. This includes the main concepts of Modern Portfolio theory, Post-Modern Portfolio theory and the Black-Litterman model. We create 10 SRIF portfolios based on a three year data period dating from May 2010 to May 2013, all complying with the restrictions of the European Union’s legislative framework. The 10 portfolios are evaluated based on a two year holding period dating from May 2013 to May 2015, and their performance is compared to 6 benchmark funds that all have a Morningstar rating of 4 or 5 stars. The results of our analysis show that the SRIF portfolios to a great extend outperform the 6 benchmark funds. The SRIF portfolios combine high returns with low standard deviation, providing investors with beneficial Sharpe ratios. It is indisputable that a SRIF portfolio would have been a very profitable investment during the last two years. Therefore, we conclude that a Sport-Relations Investment Fund should strongly be considered as a viable investment option, not only in Denmark, but on a global scale.
|Uddannelser||Cand.merc.aef Applied Economics and Finance, (Kandidatuddannelse) Afsluttende afhandling|