recall competitor benefit long
What it checks
When a carmaker's rival has a big recall, we go long the carmaker - its market share tends to grow over the next few weeks.
Mechanism
When one OEM has a major recall, direct competitors capture market-share rotation; rivals outperform ~+1.5-3% over the subsequent 10-20 trading days.
Signal rule
Competitor-set NHTSA recall severity (log(potential_units)) rolling 14d z >= +2 -> LONG current ticker T+1; hold 10/20 trading days. Competitor map covers F/GM/STLA/TM/HMC/NSANY/TSLA/RIVN/LCID and EU OEMs.
Data dependencies
daily_pricesAdjusted-close OHLCV for every US-listed ticker; primary price feed.
nhtsa_vehicle_recallsNHTSA vehicle recall campaign data mapped to auto manufacturers.
Expected edge
- Paper alpha
- +1.5-3% over 10-20d
- Paper window
- T+1 to T+20d
Hendricks-Singhal 2003 (competitor leg): +1.5-3% rival outperformance over 10-20d.
Example tickers where this is likely to fire
Illustrative only — the signal fires based on the live data, not a fixed list.
Related families
auto recall drift shortConsumer / autosNHTSA recall clusters create warranty-cost, brand, and regulatory overhang for auto manufacturers. A high z-score in affected units triggers a short signal.
recall severity premiumConsumer / autosTop-severity-tier recalls (death/injury language) produce ~2-3x the absolute return effect of routine product-quality recalls; effect concentrated in the upper quartile.
Explore recall competitor benefit long on alphactor.ai
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