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Learning Chinese? The changing investment behavior of foreign institutions in the Chinese stock market / Timo Korkeamäki, Nader Virk, Haizhi Wang, Peng Wang

International Review of Financial Analysis, Volume: 64, Pages: 190 - 203

Swansea University Author: Nader Virk

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Abstract

We analyze preferences of foreign institutional investors in the Chinese stock market in a sample that covers 2003 to 2014. We find that foreign investors changed their investment behavior during the sample period from generic patterns found in much of the world to China-specific patterns. The resul...

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Published in: International Review of Financial Analysis
ISSN: 1057-5219
Published: Elsevier BV 2019
Online Access: Check full text

URI: https://cronfa.swan.ac.uk/Record/cronfa58089
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Abstract: We analyze preferences of foreign institutional investors in the Chinese stock market in a sample that covers 2003 to 2014. We find that foreign investors changed their investment behavior during the sample period from generic patterns found in much of the world to China-specific patterns. The results suggest that foreign institutions learned to adjust their investment behavior to account for unique features of the Chinese market. Rather than following the diversified portfolio approach, they follow investment strategies that focus on a limited number of firm features.
Keywords: Foreign investor; Institutional investor; Qualified foreign institutional investor (QFII) scheme; China
College: School of Management
Start Page: 190
End Page: 203