The Informational Advantage of Foreign Investors: An Empirical Study of the Swedish Bond Market

Patrik Säfvenblad ()
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Patrik Säfvenblad: Stockholm School of Economics, Postal: Box 6501, SE-113 83 Stockholm, Sweden

No 86, Working Paper Series from Sveriges Riksbank (Central Bank of Sweden)

Abstract: This paper uses a unique dataset on daily capital ows to the Swedish bond market to analyse the relative information endowment of domestic and foreign investors. Using the standard framework of a noisy rational expectations equilibrium, it is concluded that foreign investors are on average better informed than domestic investors about the future value of sek denominated bonds. The better information of foreign investors is shown to be related to both pure Swedish factors as well as international factors.

Keywords: Bond prices; capital flows; foreign investors; informed investors; intrest rate determination (search for similar items in EconPapers)
JEL-codes: E43 G12 G14 G15 (search for similar items in EconPapers)
Pages: 20 pages
Date: 1999-06-01
New Economics Papers: this item is included in nep-fmk and nep-ifn
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