Proceedings of the 1st Aceh Global Conference (AGC 2018)

Are Foreign Investors Smarter than Domestic Investors? Empirical Evidence from Indonesia

Authors
A. Sakir, Zaida Rizqi Zainul
Corresponding Author
A. Sakir
Available Online January 2019.
DOI
https://doi.org/10.2991/agc-18.2019.61How to use a DOI?
Keywords
Investor behavior , Information advantage , Trading performance , Contrarian strategy
Abstract

The existence of different views on the superiority and dominance of foreign investor to domestic investor has been an interesting issue in behavioral finance. This study is aims at emperically comparing the advantages and disadvantages of the foreign investor to the domestic investor in term of information, behavior and performance. For this purpose, weekly stock trading data over the period 2014 – 2015 are utilized and testing using independent t-test. The study found that advantage of information and investor’s behavior between foreign and domestic investor did not show significant differences, but the trading performance showed a significant difference. Additionally, the study found that the absence of herding bias and investor competency in generating trade performance was due to their expertise in stock selection rather than market timing. These findings implied that both investors tended to use contrarian investment strategy than momentum strategy in trading them in the Indonesia Stock Exchange.

Copyright
© 2018, the Authors. Published by Atlantis Press.
Open Access
This is an open access article distributed under the CC BY-NC license (http://creativecommons.org/licenses/by-nc/4.0/).

Download article (PDF)

Volume Title
Proceedings of the 1st Aceh Global Conference (AGC 2018)
Series
Advances in Social Science, Education and Humanities Research
Publication Date
January 2019
ISBN
978-94-6252-644-0
ISSN
2352-5398
DOI
https://doi.org/10.2991/agc-18.2019.61How to use a DOI?
Copyright
© 2018, the Authors. Published by Atlantis Press.
Open Access
This is an open access article distributed under the CC BY-NC license (http://creativecommons.org/licenses/by-nc/4.0/).

Cite this article

TY  - CONF
AU  - A. Sakir
AU  - Zaida Rizqi Zainul
PY  - 2019/01
DA  - 2019/01
TI  - Are Foreign Investors Smarter than Domestic Investors? Empirical Evidence from Indonesia
BT  - Proceedings of the 1st Aceh Global Conference (AGC 2018)
PB  - Atlantis Press
SP  - 389
EP  - 395
SN  - 2352-5398
UR  - https://doi.org/10.2991/agc-18.2019.61
DO  - https://doi.org/10.2991/agc-18.2019.61
ID  - Sakir2019/01
ER  -