We establish currency as an important factor shaping global portfolios. Using a new security-
level data set, we demonstrate that investor holdings are biased toward their own currencies …

Over the last 15 years, dramatically decreasing foreign investment costs have not reduced
the home bias. We show that the home bias induced by a given cost is proportional to the …

We study whether relative optimism leads to home bias in portfolio holdings by looking at
two novel databases: a survey that includes expectations of identified professional asset …

The work is devoted to the study of the international investment portfolio, its features such as
risk, profitability and the level of international diversification, as well as global flows of …

Overinvesting domestically is well known as an investment home bias (IHB). We define an
economic home bias (EHB), whereby the IHB measures the investment weights and the …

This paper analyzes the link between political factors and sovereign bond holdings of US
investors in 60 countries over the 2003–2013 period. We find that, in general, US investors …

It is a matter of debate in how far credit ratings contribute to allocative efficiency or to
excessive volatility of asset prices and cross-border capital flows. Yet it is generally taken for …

We study the role of social trust in the equity allocation decisions of global investors using a
large sample of institutionally managed portfolios of 8,088 investors from 33 countries over …

Observed international diversification implies an investment home bias (IHB). Can bivariate
preferences with a local domestic peer group rationalize the IHB? For example, it is argued …

HONG KONG INSTITUTE FOR MONETARY RESEARCH Page 1 HONG KONG INSTITUTE FOR
MONETARY RESEARCH THE COMING WAVE G. Andrew Karolyi, David T. Ng and Eswar S …