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Suan Poh, Chee wooi Hooy and Kian-ping Lim
 
''Effect of Geographical Diversification on Informational Efficiency in Malaysia''
( 2017, Vol. 37 No.1 )
 
 
This study examines the effect of geographic diversification on informational efficiency. Four types of geographical diversification indicators are used to capture different degrees geographical diversification of a firm. By using panel data of more than 250 public listed firms in Malaysia across 11 industries for 8 years, most geographical diversification indicators show significant and positive relationship with local and global delay measures. For robustness test, this study investigates the biased result caused by unobserved time and firm effects by clustering the standard errors by firm, time and both dimensions, respectively. To further manifest the effect of investor recognition hypothesis, dummy of KLCI index is introduced as moderator to geographical diversification indicators and shows negative and significant relationship with global delay measure.
 
 
Keywords: Informational efficiency, Price delay, Geographical diversification, Malaysia
JEL: G1 - (G11, G13, G13) Portfolios, Investments, Asset and Futures Pricing, Trading Volume & Bond Interest Rates
F2 - International Factor Movements and International Business: General
 
Manuscript Received : Oct 31 2016 Manuscript Accepted : Jan 13 2017

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