Foreign Investment in Emerging Markets: International Diversification or Familiarity Bias?

2018 ◽  
Vol 54 (10) ◽  
pp. 2169-2191
Author(s):  
Yunxiao Liu ◽  
James L. Park ◽  
Bumjean Sohn
Keyword(s):  
Emerging Markets ◽  
Foreign Investment ◽  
International Diversification ◽  
Familiarity Bias

scholarly journals Determinants of Foreign Portfolio Inflows: Analysis and Implications for China

2015 ◽  
Vol 7 (2) ◽  
pp. 66 ◽  
Author(s):  
Fayyaz Ahmad ◽  
Muhammad Umar Draz ◽  
Su-chang Yang
Keyword(s):  
Economic Growth ◽  
Exchange Rate ◽  
Emerging Markets ◽  
Foreign Investment ◽  
Multiple Regression Model ◽  
Vital Role ◽  
Gdp Growth ◽  
Significant Determinant ◽  
Earnings Expectations ◽  
Number Of Factors

<p>In emerging markets, a number of factors like GDP growth, market efficiency and higher earnings expectations play a vital role in attracting stable and smooth foreign investment. This work is intended to explore the determinants of FPI in China and compare the results with determinants of FPI in India explored by Garg and Dua (2014). We have applied multiple-regression model for ten years’ data ranging from 2001 to 2010. The results indicate that external debts are the most significant determinant of FPI for China. We concur with Garg and Dua (2014) that GDP growth, FDI and exchange rate are among the significant determinants of FPI. Our findings suggest that China needs to sustain its economic growth in order to attract more FPI.</p>

Riyadh will court investors for diversification

2018 ◽  
Keyword(s):  
Emerging Markets ◽  
Foreign Investment ◽  
Capital Markets ◽  
Business Environment ◽  
Short Term ◽  
Content Type ◽  
Vision 2030

Significance Mohammed bin Salman in 2016 spearheaded ‘Vision 2030’, a grand plan for a more diversified economy, accompanied by a step-by-step transformation programme. A key element is to attract financing by improving the business environment, reforming capital markets, privatising state-owned entities and facilitating foreign investment. Impacts If plans go well, new Saudi opportunities could divert investment flows away from more mature emerging markets such as Turkey and Malaysia. Although other Gulf markets might lose out in the short term, they will ultimately benefit if investors take more interest in the region. Failure of the privatisation drive would dent the crown prince’s reputation and undermine his spending plans.

Emerging Markets: A Disaggregated Perspective on the Gains from Investing Internationally

1999 ◽  
Vol 02 (01) ◽  
pp. 99-124 ◽  
Author(s):  
S. G. M. Fifield ◽  
A. A. Lonie ◽  
D. M. Power ◽  
C. D. Sinclair
Keyword(s):  
Emerging Markets ◽  
Stock Returns ◽  
Stock Markets ◽  
Emerging Market ◽  
Market Value ◽  
International Diversification ◽  
Emerging Stock Markets ◽  
Geographical Spread ◽  
Ex Ante ◽  
Industrial Mix

Using weekly disaggregated returns data for the top twenty shares, by market value, from seventeen emerging markets over the period 1991–1996, this paper investigates the potential gains from international diversification into these markets. The paper also assesses whether these gains could have been achieved on an ex-ante basis. Finally, the paper quantifies the importance of country and industry factors in emerging market stock returns. The findings suggest that (i) substantial benefits exist from investing in emerging stock markets and (ii) these gains accrue more from the geographical spread than from the industrial mix of the equities included in the portfolio.

scholarly journals The relationship between stock markets of major developed countries and Asian emerging markets

2004 ◽  
Vol 8 (4) ◽  
pp. 201-218 ◽  
Author(s):  
Wing-Keung Wong ◽  
Jack Penm ◽  
Richard Deane Terrell ◽  
Karen Yann Ching Lim
Keyword(s):  
Emerging Markets ◽  
Stock Markets ◽  
International Diversification ◽  
Developed Countries ◽  
Stock Market Crash ◽  
Emerging Stock Markets ◽  
Long Run ◽  
Equilibrium Relationship ◽  
Asian Emerging Markets ◽  
The Relationship

With the emergence of new capital markets and liberalization of stock markets in recent years, there has been an increase in investors' interest in international diversification. This is so because international diversification allows investors to have a larger basket of foreign securities to choose from as part of their portfolio assets, so as to enhance the reward-to-volatility ratio. This benefit would be limited if national equity markets tend to move together in the long run. This paper thus studies the issue of co-movement between stock markets in major developed countries and those in Asian emerging markets using the concept of cointegration. We find that there is co-movement between some of the developed and emerging markets, but some emerging markets do differ from the developed markets with which they share a long-run equilibrium relationship. Furthermore, it has been observed that there has been increasing interdependence between most of the developed and emerging markets since the 1987 Stock Market Crash. This interdependence intensified after the 1997 Asian Financial Crisis. With this phenomenon of increasing co-movement between developed and emerging stock markets, the benefits of international diversification become limited.

scholarly journals Will China's Development lead to Mexico's Underdevelopment?

2015 ◽  
pp. 106-123 ◽  
Author(s):  
Kathleen C. Schwartzman
Keyword(s):  
Emerging Markets ◽  
Foreign Investment ◽  
Global Market ◽  
Commodity Chain ◽  
World Systems ◽  
Policy Makers ◽  
Consumer Markets ◽  
Trade Growth ◽  
New Consumer ◽  
China’S Growth

China has become an important global actor in the arenas of production, trade, and foreign investment. In 1948, China contributed slightly less than 1 percent to global exports; by 2013, it had grown to almost 12 percent. Has China's vertiginous trade growth come at the expense of other exporters or does it represent an expansion of new consumer markets? For policy makers in the so-called "emerging markets," this is most relevant since many have adopted the export-led model as their engine of development. The goal of this article is to add to the current literature on the effect of China's growth on Mexico. Combining elements of world-systems, race-to-the-bottom, and global commodity chain frameworks, I analyze the consequences of China's export growth in garlic. The evidence strongly suggests that China's entrance into this global market has had deleterious consequences for Mexico's production and exports.

scholarly journals DAMPAK PERTUMBUHAN EKONOMI, KONTROL KORUPSI, DAN YIELD TERHADAP INVESTASI ASING DI PASAR SUN

2021 ◽  
Vol 5 (2) ◽  
Author(s):  
Wahyu Tri Rahmawati ◽  
Willem A. Makaliwe
Keyword(s):  
Economic Growth ◽  
Emerging Markets ◽  
Foreign Investment ◽  
Quantitative Methods ◽  
Panel Data Analysis ◽  
Developed Countries ◽  
High Yield ◽  
Foreign Investor ◽  
Pull Factors ◽  
The Government

ABSTRACT   Foreign investment in debt securities in Indonesia continues to grow. Foreign investor ownership in Government Securities (SUN) reached 39% at the end of 2019 from initially only less than 1% at the end of 2002. Foreign investor hold the largest ownership in tradable Government Securities. This study discusses the push and pull factors of foreign portfolio in debt securities investment in emerging markets and Indonesia on the period of 2000-2017. This research uses quantitative methods with panel data analysis. The results showed that economic growth, corruption control, dan financial openness were the main pull factors for foreign investment in debt instruments in emerging markets. Low yield in developed countries was the push factor of foreign investment in debt securities into emerging markets. In addition to economic growth and corruption control, yield on local debt instruments attract foreign investment in debt securities in Indonesia. The results showed that the yield on local debt securities have a negative effect on foreign investment in Indonesian debt securities so that the government does not need to provide too high yield on Government Securities.

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