Hang Thi Ngo

Type of the article: Research Article

Abstract
This study investigates how investment funds influence the stock price volatility of the firms in which they invest. Using a sample of 196 companies listed on the Vietnamese stock market during the period 2016–2022, the analysis captures the presence and influence of investment funds through their key proxies: the ownership ratio that each fund holds in a particular firm, the fund’s size, and the type of investment fund. These proxies and other vital control variables of stock price volatility are investigated using pooled OLS, fixed effects model, random effects model, and generalized linear squares (GLS) models, along with essential tests for model validity. The empirical results reveal that the fund ownership ratio mitigates stock price volatility, whereas fund size potentially exacerbates volatility. The type of investment fund does not significantly impact the stock price. This study offers important theoretical and practical insights for firm managers and investors, providing recommendations to optimize fund management strategies and contributing to the stability and sustainable development of the Vietnamese stock market.

Acknowledgment
The authors gratefully acknowledge the financial support from the Banking Academy of Vietnam.