Information asymmetry, trading volume and returns in the Malaysian stock market
This paper examines investors’ motive to trade on the Malaysian stock market from 1st July 1997 to 30th June 2005. By applying ordinary least square (OLS) to 272 stocks as well as in three size groups, both the time series and cross-sectional results indicate that speculation on firm specific asym...
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| Main Authors: | , |
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| Format: | Conference or Workshop Item |
| Language: | English |
| Published: |
2007
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| Subjects: | |
| Online Access: | http://repo.uum.edu.my/2401/1/Chue_Wen_Yeen.pdf http://repo.uum.edu.my/2401/ |
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| Summary: | This paper examines investors’ motive to trade on the Malaysian stock market from 1st July 1997
to 30th June 2005. By applying ordinary least square (OLS) to 272 stocks as well as in three size groups, both
the time series and cross-sectional results indicate that speculation on firm specific asymmetric information is
the primary motive to trade on Malaysian stock market for the full and two sub-sample periods. The results
show that most of the investors in Malaysian stock market tend to speculate firm related information to
maximize their profits. The findings of this study provide important implications to policy makers in
addition to investors in this developing market. Proper management of foreign portfolio investment is crucial
to prevent manipulative moves and excessive speculative forms of portfolio investments that may cause
excessive surges of inflows and massive panic outflows of short-term capital and thus collapse the financial system and downturn economy. |
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