Foreign institutional ownership stability and stock price crash risk

IF 5.4 2区经济学 Q1 BUSINESS, FINANCE

Journal of International Financial Markets Institutions & Money Pub Date : 2024-01-06 DOI:10.1016/j.intfin.2024.101937

R. Shruti , M. Thenmozhi

引用次数: 0

Abstract

This study investigates the impact of foreign institutional investors (FIIs) on stock price crash risk in India. Panel regression findings reveal that higher levels of FII holdings, signifying positional trading, exacerbate crash risk. Conversely, increased stability of FII holdings, indicative of active monitoring, diminishes crash risk. Notably, FIIs’ buying interest does not influence crash risk, affirming that their risk mitigation arises from active monitoring and not from curbing selling pressure. Further analysis reveals that FII stability reduces crash risk only when controlling shareholder (i.e., promoter) equity holding is low. This promoter effect is driven by domestic promoters and not foreign promoters.

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外国机构所有权的稳定性与股价暴跌风险

本研究探讨了外国机构投资者（FII）对印度股价暴跌风险的影响。面板回归结果显示，外国机构投资者持股水平越高，表明头寸交易越多，股价暴跌风险就越大。相反，FII 持股稳定性的提高（表明积极监控）会降低股价暴跌风险。值得注意的是，外国投资机构的买入兴趣并不影响崩盘风险，这说明其风险缓解来自于积极监控，而不是抑制抛售压力。进一步的分析表明，只有当控股股东（即发起人）持股比例较低时，外国投资机构的稳定性才会降低崩盘风险。这种发起人效应是由国内发起人而非外国发起人驱动的。

本文章由计算机程序翻译，如有差异，请以英文原文为准。

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来源期刊

Journal of International Financial Markets Institutions & Money Multiple-

CiteScore

6.60

自引率

10.00%

发文量

142

期刊介绍： International trade, financing and investments, and the related cash and credit transactions, have grown at an extremely rapid pace in recent years. The international monetary system has continued to evolve to accommodate the need for foreign-currency denominated transactions and in the process has provided opportunities for its ongoing observation and study. The purpose of the Journal of International Financial Markets, Institutions & Money is to publish rigorous, original articles dealing with the international aspects of financial markets, institutions and money. Theoretical/conceptual and empirical papers providing meaningful insights into the subject areas will be considered. The following topic areas, although not exhaustive, are representative of the coverage in this Journal. • International financial markets • International securities markets • Foreign exchange markets • Eurocurrency markets • International syndications • Term structures of Eurocurrency rates • Determination of exchange rates • Information, speculation and parity • Forward rates and swaps • International payment mechanisms • International commercial banking; • International investment banking • Central bank intervention • International monetary systems • Balance of payments.