The Impact of Local Sector Information on the Performance of Single Listed Foreign Stocks
International Journal of Economics, Finance and Management Sciences
Volume 7, Issue 5, October 2019, Pages: 142-161
Received: Jul. 25, 2019; Accepted: Aug. 27, 2019; Published: Oct. 23, 2019
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Author
Muhammad Shirajul Islam, IPE Capital Limited, Dhaka, Bangladesh
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Abstract
Being an instrument for international diversification, the populations of Single listed foreign stocks are growing in major capital markets. Since this is a new trend of foreign listing, both investors and issuers may have concerns about the characteristics of these stocks. This paper focuses on thesetypes of stocks from two different sectors (HealthCare and Technology) which are originated from PRC (Peoples Republic of China) and listed only on the US markets. The sample employs 24 companies’ stock returns in the period of May 2011 to August 2013. Correlation test and Granger causality test are applied to identify the relationships and beyond that, the Bivariate Co-integration test and Impulse Response Function test are applied to identify the nature of the relationships between the stocks and both the home and the US market (Sector Index). The study reveals that these single listed stocks do not have any long term effect from both the Home and the Foreign trading markets whereas, the stocks are highly responsive towards the shocks from US markets in a very short term.
Keywords
Single Listed Stocks, Foreign Stocks, Foreign Listing, Local Sector Information, Home Market, Foreign Market
To cite this article
Muhammad Shirajul Islam, The Impact of Local Sector Information on the Performance of Single Listed Foreign Stocks, International Journal of Economics, Finance and Management Sciences. Vol. 7, No. 5, 2019, pp. 142-161. doi: 10.11648/j.ijefm.20190705.11
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Copyright © 2019 Authors retain the copyright of this article.
This article is an open access article distributed under the Creative Commons Attribution License (http://creativecommons.org/licenses/by/4.0/) which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited.
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