The equity home bias

Home bias, the empirical phenomenon that investors assign anomalously high weights to their own domestic assets, has puzzled academics for decades: financial theory predicts that an internationally well diversified portfolio of stocks and short-term bonds can reduce risk significantly without affecting expected return. Although the globalization of international equity markets has increased international investments, equity portfolios remain severely home biased today, and no single explanation seems to solve the puzzle completely. Professor Ian Cooper joined London Business School in 1978. He is Professor of Finance and has taught widely across all the programmes of the School.

Total
0
Shares
Leave a Reply

Your email address will not be published. Required fields are marked *

×
As a Guest, you have insight(s) remaining for this month. Create a free account to view 300 more annually.
Related Posts
error:

Add the Faculti Web App to your Mobile or Desktop homescreen

Install
×