Journal of Applied Finance & Banking

Global Behavioral Drivers and Domestic Feedback Dynamics to Foreign Trading Activity: An OLS–VAR Analysis of Vietnam’s Stock Market

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• Abstract

   

  This study examines the determinants of foreign trading activity in Vietnam’s stock market by integrating global and domestic financial factors. Using monthly data from 2009 to 2025, it analyzes how emerging assets such as Bitcoin, along with stock returns, exchange-rate changes, the VIX, and gold prices, influence foreign investor behavior. A two-model framework is used to distinguish external influences from internal market dynamics. Model 1 employs OLS to measure the impact of global risk sentiment and speculative trends, while Model 2 uses a VAR approach to capture feedback effects among foreign flows, market performance, and exchange-rate movements. The results show that Bitcoin returns and global volatility significantly increase foreign trading activity, whereas gold prices remain insignificant. Domestically, exchange-rate shifts and stock performance reinforce each other’s effects on foreign capital flows, demonstrating that both global shocks and domestic conditions jointly shape Vietnam’s foreign investment patterns.

   

  JEL classification numbers: G12, F31, E44, C22.

  Keywords: Bitcoin, Foreign trade, stocks, VIX, gold, Exchange rate, Finance investment.