Ownership of Cross-Listed Equities: An Investigation of Turnover, Diversification, and Risk

Posted: 13 Feb 2003

See all articles by Sie Ting Lau

Sie Ting Lau

Nanyang Technological University (NTU) - Division of Banking & Finance

Thomas H. McInish

University of Memphis - Fogelman College of Business and Economics

Abstract

Using data for a sample of Malaysian stocks that are traded in both Malaysia and Singapore, we show that the turnover rate (trading volume relative to shares held) is significantly higher in the foreign market than in the domestic market. We also find that ownership of cross-listed shares by foreign investors is not motivated by diversification benefits. Instead, we find that the proportion of a firm's shares held in Singapore is directly related to the firm's level of systematic risk.

Suggested Citation

Lau, Sie Ting and McInish, Thomas H., Ownership of Cross-Listed Equities: An Investigation of Turnover, Diversification, and Risk. Available at SSRN: https://ssrn.com/abstract=344101

Sie Ting Lau

Nanyang Technological University (NTU) - Division of Banking & Finance ( email )

S3-B1B-76 Nanyang Avenue
Singapore, 639798
Singapore
65 790 6051 (Phone)
65 791 3697 (Fax)

Thomas H. McInish (Contact Author)

University of Memphis - Fogelman College of Business and Economics ( email )

Memphis, TN 38152
United States
901-678-4662 (Phone)
901-678-3006 (Fax)

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