Brown Bag Seminar with Jesper Rangvid, Copenhagen Business School
The Department of Finance is pleased to announce the upcoming Brown Bag Seminar with Jesper Rangvid, Copenhagen Business School.
Jesper Rangvid will present
Turning Local: Home-bias dynamics of relocating foreigners
The paper is joint work with Bjarne Florentsen, Ulf Nielsson, and Peter Raahauge, Copenhagen Business School.
Using a comprehensive dataset including the total adult population of a country (Denmark), in aggregate approximately 4.3 million individuals per year, we study private investors’ preferences for domestic stocks. We compare the equity home bias of foreigners recently relocated to Denmark to the equity home bias of other investors. We find that home bias of recently relocated foreigners is lower than home bias of other investors. Our main result is that when relocated foreigners’ duration of stay increases, their home bias also increases. After 7-8 years, home bias of relocated foreigners does not differ from home bias of other investors. We discuss implications for explanations of the home-bias puzzle.