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Financial strength information and institutional investor demand: Evidence from India
- Source :
- Cogent Economics & Finance, Vol 7, Iss 1 (2019)
- Publication Year :
- 2019
- Publisher :
- Taylor & Francis Group, 2019.
-
Abstract
- In this paper, we examine whether foreign institutional investors (FII) and mutual funds (MF) show a higher preference for fundamentally stronger firms. We employ Pitroski’s F score and its constituents (profitability, efficiency, and leverage) to measure the fundamental strength of firms. Further, we examine the preferences of FIIs and MFs by conditioning on size and book-to-market ratio. Overall, the results indicate that both types of institutional investors prefer firms with higher expected profitability and are willing to take higher risks. FIIs show a higher preference for riskier firms and MFs prefer firms with higher profitability.
Details
- Language :
- English
- ISSN :
- 23322039
- Volume :
- 7
- Issue :
- 1
- Database :
- Directory of Open Access Journals
- Journal :
- Cogent Economics & Finance
- Publication Type :
- Academic Journal
- Accession number :
- edsdoj.1d1add1b96c4b80bcce070ba4ce81a7
- Document Type :
- article
- Full Text :
- https://doi.org/10.1080/23322039.2019.1623751