Oehler, A., Wendt, S., Horn, M., 2017, Are Investors Really Home-Biased when Investing at Home?; Research in International Business and Finance 40, 52-60.
Abstract
tInvestors who only invest in their domestic market are typically referred to as being home-biased. We refer to firm-level internationalization and call into question whether investingin domestic stock indices actually leads to home bias. We use three measures of firm-levelinternationalization based on percentages of foreign sales, employees in foreign countries,and foreign tax payments. We aggregate firm-level results to determine the degree of internationalization of German, French, UK and US stock indices. French and UK stock indices exhibit the largest degree of internationalization. The German index provides slightly less internationalization, whereas internationalization of the US index is lowest but nonetheless considerable. This means that investors who invest in their domestic market do not necessarily suffer from home bias. Instead, investing in domestic stock indices more likely prevents investors from a home bias instead of entrapping them to insufficient portfolios.
Keywords
Home bias, International diversification, Internationalization, Investor information, Retail investors, Stock market index
JEL Classifications
G11, G02, F65
Zuvor:
Oehler, A., Wendt, S., Horn, M., 2015, Are Investors Really Home-Biased when Investing at Home?, Working Paper, Bamberg 2015, 29th Annual Meeting The Academy of Financial Services 2015, October 15-16; Eastern Finance Association 2015 Annual Meeting, April 8-11.
Auch:
Oehler, A., Horn, M., Wendt, S., 2021, Information Illusion? Placebic Information and Stock Price Forecasts; AEA American Economic Association Annual Meeting 2021, January 3-5.
Oehler, A., Horn, M., Wendt, S., 2017, Brexit: Short-term Stock Price Effects and the Impact of Firm-level Internationalization; Finance Research Letters 22, 175-181.
Oehler, A., Wendt, S., Horn, M., 2016, Internationalization of Blue-Chip versus Mid-Cap Stock Indices: an Empirical Analysis for France, Germany, and the UK; Atlantic Economic Journal 44, December, 501-518.
Oehler, A., Horn, M., Wendt, S., 2020, Information Illusion: Placebic Information and Stock Price Estimates; Jahrestagung 2020 Verein für Socialpolitik, September 27-30; 28th Global Conference on Business and Finance, January 6-8.
Oehler, A., Horn, M., Wendt, S., 2019, Information Illusion: Placebic Information and Stock Price Estimates; 2019 Society for Judgment and Decision Making Conference, November 15-18; Psychonomic Society 2019 Annual Meeting, November 14-17; 88th International Atlantic Economic Conference, October 17-20; 2019 Annual Meeting Academy of Financial Services, October 15-16; IAREP/SABE Conference, September 1-4; Behavioural Finance Working Group Conference, June 6-7.
Oehler, A., Wendt, S., 2016, Alles international: Sind Index-Investments mehr als naive Diversifikation?; in: Eckert, S., Trautnitz, G. (Hrsg.), Internationales Management und die Grundlagen des globalisierten Kapitalismus, Festschrift für Prof. Dr. Johann Engelhard, Springer, Berlin 2016, 219-229.
