The purpose of this thesis is to examine if and how CEO ownership affects firm performance on Swedish companies depending on the market conditions. We would also like to examine the question if this relationship still holds when taking the possibility of an endogeneity determined relationship into account. A quantitative approach using regression analysis and descriptive statistics have been used. The regression analysis was conducted with an ordinary least square regression and a two-stage least square regression. The information has been attained from annual reports and Datastream. The study has a deductive approach. The theoretical perspective has been derived from classical agency theory as well as entrenchment theory. Companies listed at Nasdaq OMX Stockholm Large and Mid Cap during 2000-2006 has been empirically studied to obtain the data selected. Results from OLS regressions confirms a positive relation between firm performance and CEO ownership on the Swedish market. The relationship holds for our bear market period (2000-2002) as well as for the whole period (2000-2006). During bull market the relationship cannot be statistically supported. The results imply that the market condition affects the relationship; hence external forces have an impact on the result. Thus a Two-stage least square regression was conducted in order to examine if the relationship could be endogeneity determined and the result is that the relationship could be determined by exogenous forces and thus; the relationship do not hold
