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Determinants of foreign portfolio investment in emerging markets: evidence from Saudi stock market

Author

Listed:
  • Ahmed Badawi
  • Anas Al Qudah

    (Yarmouk University)

  • Waleed M. Rashideh

    (Al Imam Mohammad Ibn Saud Islamic University)

Abstract

Saudi Arabia has the largest stock market in the Gulf Region. Recently, it officially opened up to foreign investors in an effort to promote market stability and reduce volatility. In this study, we aim to explore the determinants that encourage foreign investors to invest in the Saudi stock market. The analysis shows that investors prefer to invest in privately owned firms and institutions with relatively higher levels of tangible assets while they disfavour firms that are government owned and have a high level of liquidity. This study investigates an issue that has not been previously addressed in this particular market; it also contributes to an understanding of foreign investors’ behaviours in emerging markets.

Suggested Citation

  • Ahmed Badawi & Anas Al Qudah & Waleed M. Rashideh, 2019. "Determinants of foreign portfolio investment in emerging markets: evidence from Saudi stock market," Journal of Economics and Finance, Springer;Academy of Economics and Finance, vol. 43(4), pages 779-794, October.
    • Handle: RePEc:spr:jecfin:v:43:y:2019:i:4:d:10.1007_s12197-019-09482-8
    DOI: 10.1007/s12197-019-09482-8
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    Cited by:

    1. Ayman Hassan Bazhair & Mohammed Naif Alshareef, 2022. "Dynamic relationship between ownership structure and financial performance: a Saudi experience," Cogent Business & Management, Taylor & Francis Journals, vol. 9(1), pages 2098636-209, December.
    2. Rayed Obaid Hammoud Alobaid & Ameen Qasem & Adel Ali Al-Qadasi, 2024. "Corporate Social Responsibility, Ownership Structure, and Firm Investment Efficiency: Evidence from the Saudi Stock Market," Sustainability, MDPI, vol. 16(15), pages 1-25, August.

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    More about this item

    Keywords

    Portfolios; Emerging markets; Investment; Saudi market;
    All these keywords.

    JEL classification:

    • E31 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Price Level; Inflation; Deflation
    • E37 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Forecasting and Simulation: Models and Applications

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