Abstract
This paper tries to explain the home bias puzzle by incompleteness of observation. Our result suggests that investors invest more in domestic asset when they are allowed to observe the process of foreign asset only partially.
| Original language | English |
|---|---|
| Pages (from-to) | 75-80 |
| Number of pages | 6 |
| Journal | Economics Letters |
| Volume | 62 |
| Issue number | 1 |
| Publication status | Published - 1999 Jan 1 |
| Externally published | Yes |
Keywords
- F30
- G11
- Home bias puzzle
- International portfolio diversification
- International risk-sharing
- Optimal portfolio choice
- Stochastic filtering
ASJC Scopus subject areas
- Finance
- Economics and Econometrics