This study examines the language effect on investing behavior in local stock markets for local- and foreign-language investors using Google search records. First, we find that attention to a local language stimulates attention to a foreign language, increases abnormal news coverage, and has better predictability on stock returns. Second, investors who do Google searches in the local language react faster to a news event's shock than those who search in the foreign language. Third, only attention to the local language can reduce the price drift of an earnings surprise. Last, firm-level information asymmetry is a channel for local advantage. Therefore, we suggest that investors who use a stock market's local language have a local advantage when seeking more profitable investment opportunities in that stock market.

这项研究使用Google搜索记录研究了语言对本地和外语投资者在本地股票市场投资行为的影响。首先，我们发现对本地语言的关注会激发对外国语言的关注，增加异常新闻报道的范围，并具有更好的股票收益可预测性。其次，以当地语言进行Google搜索的投资者对新闻事件的震惊要比以外部语言进行搜索的投资者更快。第三，仅关注当地语言可以减少收入意外带来的价格波动。最后，企业层面的信息不对称是获得本地优势的渠道。因此，我们建议使用股票市场当地语言的投资者在该股票市场寻求更多获利的投资机会时，应具有当地优势。