Dear Dilesha,

Yes, that would be possible.

First and foremost is that, each and every stock extremely behave differently in ways sometimes the most adept and adroit financiers of all facets miss some of which. Therefore, this niche, while its exceptionally exciting to do research and in fact, U.S. Securities and Stock Exchanges has defined several laws and rules around it, also referring to that as "Research Report", yet it is very challenging.

Basically, while theories are great to practice, in reality, there are a myriad of factors that influence the returns of stock, both from bottom up and from top down, meaning that there are internal matters inside the company, which through various types of news, for instance, whether "true" or "false", it would affect the returns. From top down, there are economical factors of various types such as 10-years treasury yields, and of course my example is about U.S. markets, unemployment rates, some exchange rates, some derivative indices, and the list goes on and on, that would impact that.

There is also seasonal quarterly earnings reports that would affect that. Investors and traders emotions, market volatilities, uncertain or un/expected chaotic events which would create risks.

Most importantly, which basically this part put all theories on jeopardy, is that sometimes some tickers do not attract traders and investors, no matter how great the company is, thus such stock does not follow calculations and quantitive financial analysis.

All set aside, this filed is absolutely fantastic. For instance, Dec 19, 2018, two days from now, in the U.S., there will be an important event for interest rate announcement, which is estimated at about 80% that would rise, yet majorities do not know what it is going to happen and that decision would impact the entire global stock markets and every and each stock differently, which indirectly impact the returns of that stock in both short and long runs.

I hope my off-balance-sheet comments would be helpful and wish you all the best.

Best regards,

J.

Dear Dilesha

You will generate different average returns the greater the variability in the annual returns. Your CAR formula is an arithmetic mean whereas your BHAR is a geometric mean. In addition, The BHAR implies your beginning portfolio of investments will not change over the holding period of your study as opposed to the CAR conceivably could have a different mix of investments across time.

Thank you so much for your explanation Prof. J. Rafiee .

Prof. Raymond A K Cox ,Thanks a lot for your clear answer.