Jump to ContentJump to Main Navigation
International FinanceA Survey$
Users without a subscription are not able to see the full content.

H. Kent Baker and Leigh A. Riddick

Print publication date: 2012

Print ISBN-13: 9780199754656

Published to Oxford Scholarship Online: May 2013

DOI: 10.1093/acprof:oso/9780199754656.001.0001

Show Summary Details
Page of

PRINTED FROM OXFORD SCHOLARSHIP ONLINE (www.oxfordscholarship.com). (c) Copyright Oxford University Press, 2018. All Rights Reserved. Under the terms of the licence agreement, an individual user may print out a PDF of a single chapter of a monograph in OSO for personal use (for details see www.oxfordscholarship.com/page/privacy-policy).date: 14 December 2018

The Home Bias Puzzle in Equity Portfolios

The Home Bias Puzzle in Equity Portfolios

Chapter:
(p.310) 15 The Home Bias Puzzle in Equity Portfolios
Source:
International Finance
Author(s):

PIET SERCU

ROSANNE VANPEE

Publisher:
Oxford University Press
DOI:10.1093/acprof:oso/9780199754656.003.0015

This chapter reviews the recent literature on equity home bias and shows that people overinvest in domestic stocks relative to the theoretically optimal investment portfolio. The chapter examines different home bias measures and illustrates the extent and the evolution of equity home bias both with recent portfolio holdings data and longer time-series. Institutional-based and behavior-based explanations for the puzzle are considered and discussed. The chapter concludes that none of the proposed theories can explain the full extent of the bias by itself. International portfolio choice might very well be caused by a mixture of rational and irrational factors.

Keywords:   home bias, international portfolio diversification, investment costs, information effects

Oxford Scholarship Online requires a subscription or purchase to access the full text of books within the service. Public users can however freely search the site and view the abstracts and keywords for each book and chapter.

Please, subscribe or login to access full text content.

If you think you should have access to this title, please contact your librarian.

To troubleshoot, please check our FAQs , and if you can't find the answer there, please contact us .