The Impact of Fundamental, Institutional Investors and Macroeconomics on Stock Returns

[[abstract]]The stock returns are affected by various factors. These factors also confuse the investors during their stock choosing process. In order to provide the investors a better decision-making strategy while choosing stocks, this research was to study the effect of the fundamentals, the institutional investors and the macroeconomics for the stock returns. The research applied the module of the Panel Data Regression to analyze how the stock returns were affected by these three variables. The research data was collected from the stocks of Taiwan 50 and Taiwan Mid-Cap 100 during the period of 2002 to 2012. For the variable of the fundamentals, the result showed the significantly positive correlation between the stock returns and the return on total assets ratio. For the variable of the institutional investors, there was a significantly positive impact on the stock returns from both the net buy/net sell of the institutional investors and the margin balance. For the variable of the macroeconomics, it indicated the stock returns were significantly positive affected by TAIEX and negative affected by the CPI