Foreign investors’ decision of trading and their ownership in Vietnam stock market.

Tóm tắt

This paper aims to study the relationship between foreign investors’ investment decisions and the stock market via their volume trading for firms listed in Vietnam stock market from 2007 to 2011. The main findings are summarized as follows. Firstly, a firm’s market size does not significantly affect foreigners’ decision of trading on the whole, it just influences their buying or selling decision in specified industries. Secondly, foreign investors prefer trading stocks of firms with high profitability measured by not only ROE and ROA ratio as conventional indicators but also by EBITDA as another important factor affecting their trading decision for short term position and to their ownership ratio for long term position. Thirdly, in terms of firm’s dividend policy, foreign investors tend to trade stocks of financial firms with low dividend yield rather than hold them for long term position.