The stock preferences of domestic versus foreign investors: Evidence from Qualified Foreign Institutional Investors (QFIIs) in China

Zou, Liping; Tang, Tiantian; Li, Xiaoming

doi:10.1016/j.mulfin.2016.11.002

Cited by 33 publications

(27 citation statements)

References 33 publications

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“…Although there are previous studies that focus on the investment preferences of foreign mutual funds (e.g., Covrig, Lau, and Ng 2006;Zou, Tang and Li 2016), the majority of previous studies on foreign institutional ownership consider foreign investors as a homogenous group (see, e.g., Kang and Stulz 1997;Dahlquist and Robertsson 2001;Min and Bowman 2015). The comparison of portfolio holding decisions of foreign funds and foreign corporate investors is often neglected.…”

Section: Foreign Funds Vs Foreign Corporationsmentioning

confidence: 99%

“…Previous studies on the determinants of foreign equity ownership either considers foreign investors as a homogenous group (Kang and Stulz 1997;Dahlquist and Robertsson 2001;Min and Bowman 2015) or focuses only on the preferences of foreign mutual funds (Covrig, Lau, and Ng 2006;Zou, Tang and Li 2016). In this study, we explicitly distinguish between the ownership choices of foreign funds and foreign corporations.…”

Section: Introductionmentioning

confidence: 99%

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Is conservative reporting attractive to foreign institutional investors? Evidence from an emerging market

Yıldız

Karan

Özkan

2019

The European Journal of Finance

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This study investigates the relation between conservative reporting and foreign institutional ownership using a unique dataset of firms in Turkey. In doing so, we distinguish between foreign funds and corporations. Contrary to prior findings, our analysis shows that conservative reporting is not necessarily a desirable accounting feature for foreign institutional investors. We also find that the interplay between conservative reporting and ownership is significantly different between foreign funds and corporations. The estimated negative relation holds only for foreign funds. Further analysis reveals that foreign funds do not find conservative reporting desirable in low-asymmetric information firms and reduce ownership with greater accounting conservatism in such firms. The analysis sheds significant lights on the relevance of conservative reporting in alleviating the negative consequences of asymmetric information.

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Section: Foreign Funds Vs Foreign Corporationsmentioning

confidence: 99%

Section: Introductionmentioning

confidence: 99%

Is conservative reporting attractive to foreign institutional investors? Evidence from an emerging market

Yıldız

Karan

Özkan

2019

The European Journal of Finance

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“…Study conducted by Huang (2007) showed an increase in persistence of volatility after the QFII scheme's implementation in both mutual fund and A-share markets. Wang & Han (2008) found return volatility of the Shanghai and Shenzhen A-share indices were lower than those of the corresponding B-share indices during -2005. Zou et al (2016 used unique data spanning from 2003 through 2014 to examine the preferences of domestic and foreign institutional holdings in China; empirical findings showed similar preferences of both institutions on certain stock characteristics, but difference towards industry allocations.…”

Section: Market Liberalization In Chinamentioning

confidence: 99%

Factors Influencing Equity Return Correlations between China’s Pairs of A- and B-Share Markets: Effect of QFII’s Implementation

Hsiao¹,

Tu²,

Chen³

2017

IJFR

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This paper was intended to examine factors influencing the correlations between A-and B-shares of individual firms, and explore the effects of Qualified Foreign Institutional Investor's (QFII) implementation on correlations. The empirical results show that interest rate differential, relative turnover rate, relative return volatility, and market sentiment had impacts on correlation both before and after the QFII's implementation. After its implementation, correlations became more sensitive to premium, relative turnover rate and market sentiment. Furthermore, the estimated constant term for overall market correlation became more negative (raw values from -0.3413 to -0.8815), indicating an increasing correlation between A-and B-shares' returns. The policy implications are that much benefit of diversification into emerging markets such as paired A-and B-shares can be accomplished, together with taking several influential factors into account.

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“…Industry characteristics may also effect the stock preferences of the investors. Zou et al (2016) study the stock preferences of domestic and foreign investors and exhibit that foreign institutional investors prefer to invest in sectors such as financial, transportation, professional services, and technology in Chinese capital markets. This paper gives insights about firm and industry level perspectives since the effects of institutional investors can be observed both in capital markets and directly the growth of the firm and hence the growth of industry incorporating in the economy (Railo, 2000).…”

Section: Introductionmentioning

confidence: 99%

Stock Allocation in Turkish Capital Markets: Industry and Firm Level Perspectives

Furtuna¹

2017

Eur. j. econ. bus. stud.

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Investors' trading patterns has been an intensively researched topic in emerging markets depending on their significant role and power in the capital markets. This paper provides what global and domestic factors have driven the stock allocation of investors in Turkey and how has the crisis changed investors' attitude toward stock allocation between the years 2006 and 2016. Year-end stock allocation data are obtained from the Central Securities Depository Institution of Turkey. Stock allocation has been investigated mainly in terms of the domestic and foreign stock investments. A detailed classification of investors as individual and institutional investors in terms of investment funds, corporate and investment trusts with firm and industry levels has also been evaluated. The variations on stock allocation has been examined in BIST Industrials, Financials and Services Industries. Additionally, this paper gives an insight about the firm and industry level stock allocation in Turkish Capital Markets considering the responsible stockholders. Corporate governance practices are considered to be strengthened with the growing role of institutional investors in the financial system, which provide insights about the investor profile of BIST Corporate Governance Index in the related period.

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The stock preferences of domestic versus foreign investors: Evidence from Qualified Foreign Institutional Investors (QFIIs) in China

Cited by 33 publications

References 33 publications

Is conservative reporting attractive to foreign institutional investors? Evidence from an emerging market

Is conservative reporting attractive to foreign institutional investors? Evidence from an emerging market

Factors Influencing Equity Return Correlations between China’s Pairs of A- and B-Share Markets: Effect of QFII’s Implementation

Stock Allocation in Turkish Capital Markets: Industry and Firm Level Perspectives

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