Access to information and international portfolio allocation

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Thapa, Chandra and Paudyal, Krishna and Neupane, Suman (2013) Access to information and international portfolio allocation. Journal of Banking and Finance, 37 (7). pp. 2255-2267. ISSN 0378-4266 (https://doi.org/10.1016/j.jbankfin.2013.01.011)

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Abstract

We examine whether foreign equity holdings of portfolio investors depend on the level of information accessibility between the investors’ home and host countries. Using a comprehensive data set, alternative measures of information accessibility and robust analytical techniques, we show that differences in access to cross-country information significantly influence investors’ portfolio allocation decisions. Furthermore, the results suggest that for a given level of access to information, investors prefer to invest more in countries with a higher quality of legal/macro-institutions. Finally, the findings also confirm that the implications of information accessibility are more pronounced when markets are turbulent.

ORCID iDs

Thapa, Chandra ORCID logoORCID: https://orcid.org/0000-0001-8661-8079, Paudyal, Krishna ORCID logoORCID: https://orcid.org/0000-0002-0372-304X and Neupane, Suman;
CORE (COnnecting REpositories)