@article{ART002205289},
author={Hosung Jung and Soonho Kim},
title={The Effects of Stock Holdings and Trading by Tax Haven Investors},
journal={Journal of Insurance and Finance},
issn={2384-3209},
year={2017},
volume={28},
number={1},
pages={97-134},
doi={10.23842/jif.2017.28.1.004}
TY - JOUR
AU - Hosung Jung
AU - Soonho Kim
TI - The Effects of Stock Holdings and Trading by Tax Haven Investors
JO - Journal of Insurance and Finance
PY - 2017
VL - 28
IS - 1
PB - Korea Insurance Research Institute
SP - 97
EP - 134
SN - 2384-3209
AB - This study examines the effect of stock holdings and trading by investors from offshore tax havens (hereafter, tax haven investors) on their target firms and the Korean stock market. This study identifies how tax haven investors’ holdings affect target firms in terms of firm value, corporate governance, dividends, R&D investment, liquidity, information efficiency, and idiosyncratic risk. Moreover, this study investigates the effect on tax haven investors’ trading on liquidity and volatility in the Korean stock market, by focusing on total trading volume, gross buy volume, gross sell volume, and net buy volume.
The main findings of this study are threefold. First, target firms show a different pattern of value changes subsequent to block acquisition announcements by tax haven investors than to those by domestic or other foreign investors. Second, we find that while tax haven investors' shareholding deteriorates target firms' corporate governance, it has a positive influence on information efficiency. We do not find a significant impact on tax haven investors' ownership on dividends, R&D investments stock liquidity, or idiosyncratic risks. Third, tax haven investors’ trading exacerbates liquidity in the Korean stock market and increases stock return volatility. Based on these findings, this study suggests that regulatory authorities should continue monitoring existing policies to prevent the above-mentioned negative influences of tax haven investors in the Korean stock market.
KW - tax heaven investors;firm value;corporate governance;liquidity;volatility
DO - 10.23842/jif.2017.28.1.004
ER -
Hosung Jung and Soonho Kim. (2017). The Effects of Stock Holdings and Trading by Tax Haven Investors. Journal of Insurance and Finance, 28(1), 97-134.
Hosung Jung and Soonho Kim. 2017, "The Effects of Stock Holdings and Trading by Tax Haven Investors", Journal of Insurance and Finance, vol.28, no.1 pp.97-134. Available from: doi:10.23842/jif.2017.28.1.004
Hosung Jung, Soonho Kim "The Effects of Stock Holdings and Trading by Tax Haven Investors" Journal of Insurance and Finance 28.1 pp.97-134 (2017) : 97.
Hosung Jung, Soonho Kim. The Effects of Stock Holdings and Trading by Tax Haven Investors. 2017; 28(1), 97-134. Available from: doi:10.23842/jif.2017.28.1.004
Hosung Jung and Soonho Kim. "The Effects of Stock Holdings and Trading by Tax Haven Investors" Journal of Insurance and Finance 28, no.1 (2017) : 97-134.doi: 10.23842/jif.2017.28.1.004
Hosung Jung; Soonho Kim. The Effects of Stock Holdings and Trading by Tax Haven Investors. Journal of Insurance and Finance, 28(1), 97-134. doi: 10.23842/jif.2017.28.1.004
Hosung Jung; Soonho Kim. The Effects of Stock Holdings and Trading by Tax Haven Investors. Journal of Insurance and Finance. 2017; 28(1) 97-134. doi: 10.23842/jif.2017.28.1.004
Hosung Jung, Soonho Kim. The Effects of Stock Holdings and Trading by Tax Haven Investors. 2017; 28(1), 97-134. Available from: doi:10.23842/jif.2017.28.1.004
Hosung Jung and Soonho Kim. "The Effects of Stock Holdings and Trading by Tax Haven Investors" Journal of Insurance and Finance 28, no.1 (2017) : 97-134.doi: 10.23842/jif.2017.28.1.004