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An Investigation into the Benefits of Investing in Chinese Multinational Companies

An Investigation into the Benefits of Investing in Chinese Multinational Companies We provide a unique longitudinal analysis into firm-level multinationality of Chinese firms between 2002 and 2012 using two measures of multinationality—the Aggarwal, Berrill, Hutson and Kearney (2011, International Business Review, 20, 557–577) system and foreign sales as a percentage of total sales. We find that Chinese firms have low levels of multinationality with most foreign sales in the triad regions of Asia, Europe and North America. We use mean variance spanning tests to investigate the benefits from investing in Chinese multinational corporations (MNCs). We find that Chinese MNCs offer little diversification benefits to domestic investors and firms with greater multinationality levels do not result in greater benefits. http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png Journal of Emerging Market Finance SAGE

An Investigation into the Benefits of Investing in Chinese Multinational Companies

Journal of Emerging Market Finance , Volume 17 (2): 24 – Aug 1, 2018

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Publisher
SAGE
Copyright
© 2018 Institute of Financial Management and Research
ISSN
0972-6527
eISSN
0973-0710
DOI
10.1177/0972652718776859
Publisher site
See Article on Publisher Site

Abstract

We provide a unique longitudinal analysis into firm-level multinationality of Chinese firms between 2002 and 2012 using two measures of multinationality—the Aggarwal, Berrill, Hutson and Kearney (2011, International Business Review, 20, 557–577) system and foreign sales as a percentage of total sales. We find that Chinese firms have low levels of multinationality with most foreign sales in the triad regions of Asia, Europe and North America. We use mean variance spanning tests to investigate the benefits from investing in Chinese multinational corporations (MNCs). We find that Chinese MNCs offer little diversification benefits to domestic investors and firms with greater multinationality levels do not result in greater benefits.

Journal

Journal of Emerging Market FinanceSAGE

Published: Aug 1, 2018

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