Do stocks outperform bank deposits in China?

Jiexiang Huang, Wei Guo*, Jin E. Zhang

*Corresponding author for this work

Research output: Contribution to journalArticlepeer-review

1 Citation (Scopus)


This paper investigates whether stocks outperform risk-free assets in the US and China in terms of buy-and-hold returns over different horizons. We find that stock returns underperform the one-month bank deposit rate in the Chinese market, consistent with the finding of Bessembinder (2018) that the returns to the majority of common stocks are less than one-month Treasuries. The paper explores the important role of positive skewness in the distribution of individual stock returns, attributable to skewness in monthly returns. These results further emphasize the importance of portfolio diversification in the Chinese market.

Original languageEnglish
Article number101464
JournalPacific Basin Finance Journal
Publication statusPublished - Dec 2020
Externally publishedYes


  • Buy-and-hold returns
  • Chinese market
  • Individual stock returns
  • Return skewness


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