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Foreign versus local investors: Who knows more? Who makes more?

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  • Kalev, Petko S.
  • Nguyen, Anh H.
  • Oh, Natalie Y.

Abstract

This paper examines the nature of information asymmetry between foreign and local investors on the Helsinki stock exchange (HEX) for the period 1999-2004. We take into account the differences in informational characteristics by partitioning stocks into single-listed, cross-listed and internationally well-known stock categories, after which we compare foreign and local investors' performance and trading advantages. Local investors have trading advantages in the short term in all stock categories. However, such local advantages diminish for Nokia, the only internationally well-known stock on HEX.

Suggested Citation

  • Kalev, Petko S. & Nguyen, Anh H. & Oh, Natalie Y., 2008. "Foreign versus local investors: Who knows more? Who makes more?," Journal of Banking & Finance, Elsevier, vol. 32(11), pages 2376-2389, November.
    • Handle: RePEc:eee:jbfina:v:32:y:2008:i:11:p:2376-2389
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    More about this item

    Keywords

    G10 Foreign and local investors Home bias Information asymmetry Ownership Single-listed; cross-listed and internationally well-known stocks;

    JEL classification:

    • G10 - Financial Economics - - General Financial Markets - - - General (includes Measurement and Data)

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