HOME BIAS AS A KEY BEHAVIORAL DEVIATION OF PORTFOLIO INVESTORS DECISIONS

  • P. Dziuba Institute of International Relations of Taras Shevchenko National University of Kyiv
  • K. Shtogrin Institute of International Relations of Taras Shevchenko National University of Kyiv

Abstract

Abstract. The comparative analysis of the main approaches to the reasons for the home bias is explored. The main factors of home bias are identified. The reasons for the existence of home bias are determined on the basis of systematization of the existing discourse. The main stages of the evolution of approaches to determining the reasons for home bias are identified. It was found that the most promising approach is the behaviourist approach, as well as the institutional approach and the transaction costs approach. The historical and current dynamics of the home bias in the investment portfolios of different countries is studied. A comparative analysis of the home bias for different groups of countries according to their level of economic development is carried out. It was found that developed countries have the lowest share of local market assets in the portfolio. The evolution of approaches to the home bias has been studied. The main scientific publications on the issue of home bias in the historical perspective are analysed and systematized. The main quantitative dimensions of the expression of home bias are highlighted. The main forms of quantitative expression of home bias, which received relative expression in the form of indices, are studied. The qualitative and quantitative composition of modern investment portfolios of the countries with the largest shares in the world market capitalization is studied and analysed. It has been found that there are countries with traditionally low and high levels of international diversification, such as China and Luxembourg, respectively.
Key words: home bias, behaviorism, investment portfolio, international diversification, institutionalism, transaction costs. 

Author Biographies

P. Dziuba, Institute of International Relations of Taras Shevchenko National University of Kyiv

  Ph.D. (Economics), Doctor of Economics, Professor, Department of International Finance, 

 

K. Shtogrin , Institute of International Relations of Taras Shevchenko National University of Kyiv

Graduate student, Department of International Finance  

 

Published
2021-03-03