Download or read book Are the Gains from Foreign Diversification Diminishing written by Karen K. Lewis and published by . This book was released on 2012 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt: How important is foreign diversification? In this paper, we re-examine this question motivated by findings from the literature about foreign companies that are listed on US exchanges. Specifically, domestic portfolios including cross-listed stocks can provide the same diversification as foreign market returns without the need for US investors to go abroad. At the same time, the betas of these foreign stock returns against the US market increase after cross-listing, suggesting diversification worsens over time. In this paper, we assess the impact of these changes on foreign diversification for a US investor. We test for and estimate breaks in the sensitivity of individual foreign stocks listed on US exchanges. We find that roughly half of the changes in betas arise from greater integration between the U.S. and the companies' home markets, not in the companies betas themselves. Moreover, the gains from diversifying into these stocks has declined over time.
Download or read book Are the Gains from Foreign Diversification Diminishing written by Choong Tze Chua and published by . This book was released on 2010 with total page pages. Available in PDF, EPUB and Kindle. Book excerpt:
Download or read book Is the International Diversification Potential Diminishing Foreign Equity Inside and Outside the Us written by Karen K. Lewis and published by . This book was released on 2010 with total page 74 pages. Available in PDF, EPUB and Kindle. Book excerpt: Over the past two decades international markets have become more open, leading to a common perception that global capital markets have become more integrated. In this paper, I ask what this integration and its resulting higher correlation would imply about the diversification potential across countries. For this purpose, I examine two basic groups of international returns: (1) foreign market indices and (2) foreign stocks that are listed and traded in the US. I examine the first group since this is the standard approach in the international diversification literature, while I study the second group since some have argued that US-listed foreign stocks are the more natural diversification vehicle (Errunza et al (1999)). In order to consider the possibility of shifts in the covariance of returns over time, I extend the break-date estimation approach of Bai and Perron (1998) to test for and estimate possible break dates across returns along with their confidence intervals. I find that the covariances among country stock markets have indeed shifted over time for a majority of the countries. But in contrast to the common perception that markets have become significantly more integrated over time, the covariance between foreign markets and the US market have increased only slightly from the beginning to the end of the last twenty years. At the same time, the foreign stocks in the US markets have become significantly more correlated with the US market. To consider the economic significance of these parameter changes, I use the estimates to examine the implications for a simple portfolio decision model in which a US investor could choose between US and foreign portfolios. When restricted to holding foreign assets in the form of market indices, I find that the optimal allocation in foreign market indices actually increases over time. However, the optimal allocation into foreign stocks decreases when the investor is allowed to hold foreign stocks that are traded in the US. Also, the minimum variance attainable by the foreign portfolios has increased over time. These results suggest that the benefits to diversification have declined both for stocks inside and outside the US.
Download or read book Is the International Diversification Potential Diminishing written by Karen K. Lewis and published by . This book was released on 2006 with total page 73 pages. Available in PDF, EPUB and Kindle. Book excerpt: Over the past two decades international markets have become more open, leading to a common perception that global capital markets have become more integrated. In this paper, I ask what this integration and its resulting higher correlation would imply about the diversification potential across countries. For this purpose, I examine two basic groups of international returns: (1) foreign market indices and (2) foreign stocks that are listed and traded in the US. I examine the first group since this is the standard approach in the international diversification literature, while I study the second group since some have argued that US-listed foreign stocks are the more natural diversification vehicle (Errunza et al (1999)). In order to consider the possibility of shifts in the covariance of returns over time, I extend the break-date estimation approach of Bai and Perron (1998) to test for and estimate possible break dates across returns along with their confidence intervals. I find that the covariances among country stock markets have indeed shifted over time for a majority of the countries. But in contrast to the common perception that markets have become significantly more integrated over time, the covariance between foreign markets and the US market have increased only slightly from the beginning to the end of the last twenty years. At the same time, the foreign stocks in the US markets have become significantly more correlated with the US market. To consider the economic significance of these parameter changes, I use the estimates to examine the implications for a simple portfolio decision model in which a US investor could choose between US and foreign portfolios. When restricted to holding foreign assets in the form of market indices, I find that the optimal allocation in foreign market indices actually increases over time. However, the optimal allocation into foreign stocks decreases when the investor is allowed to hold foreign stocks that are traded in the US. Also, the minimum variance atta
Download or read book Economic Benefits of Export Diversification in Small States written by Arnold McIntyre and published by International Monetary Fund. This book was released on 2018-04-11 with total page 23 pages. Available in PDF, EPUB and Kindle. Book excerpt: The paper considers concepts of economic diversification with respect to exports (including service sectors) for small states. We assessed the economic performance of different groups of 34 small states over the period of 1990-2015 and found those more diversified experienced lower output volatility and higher average growth than most other small states. Our findings are consistent with conventional economic theories but we found that export diversification has a more significant impact on reducing output volatility than improving long run growth in small states. Diversification requires fundamental changes and should be contemplated in the context of a cohesive development strategy.
Download or read book Portfolio Investment Flows to Emerging Markets written by Sudarshan Gooptu and published by World Bank Publications. This book was released on 1993 with total page 74 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Download or read book International Evidence on the Effects of Having No Capital Gains Taxes written by Fraser Institute (Vancouver, B.C.) and published by The Fraser Institute. This book was released on 2001 with total page 36 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Download or read book Guide to Investment Strategy written by Peter Stanyer and published by John Wiley & Sons. This book was released on 2011-09-20 with total page 223 pages. Available in PDF, EPUB and Kindle. Book excerpt: The first edition of The Economist Guide to Investment Strategy explained the fundamentals of investment risk, how to put together "keep-it-simple" investment strategies, and the need to guard against our own behavior leading to dreadful investment mistakes. The global crisis that erupted in 2008 exposed the flaws in many more complicated investment strategies. The second edition starts with a new section on financial fraud and how investors can help to protect themselves against this "hearty perennial." It also includes a new section on risk profiling and discusses the role of risk tolerance questionnaires. In Chapter 3 data are provided pointing to underperformance of equities between 1978 and 2008. Against this background, there is a new Chapter 4—"Which should we do: buy-and-hold or time markets?" Chapter 5, which discusses the design of short-term and long-term strategies, includes a new section—"How safe is cash?"—and the discussion of bond ladders is extended to reflect issues of bond selection in the light of corporate credit risk and the financial difficulties of some US municipal authorities. Part 2 has been updated extensively to reflect developments in the past four years and the impact of the financial crisis on credit instruments, hedge funds, private equity, and real estate. The book concludes with a new chapter on investing in art and collectibles. It explores the argument that art prices "float aimlessly," discusses financial investment in art, and provides some reasons for expecting that a portfolio of art might perform well in the future.
Download or read book The Quotable Billionaire written by Steven D. Price and published by Skyhorse Publishing Inc.. This book was released on 2009-11 with total page 294 pages. Available in PDF, EPUB and Kindle. Book excerpt: Quotations about money lots of it and how to make and use and lose it from the world s richest men and women, past and...
Download or read book Economic Diversification in the GCC written by Mr.Tim Callen and published by International Monetary Fund. This book was released on 2014-12-23 with total page 32 pages. Available in PDF, EPUB and Kindle. Book excerpt: Abstract: The economies of the six Gulf Cooperation Council (GCC) countries are heavily reliant on oil. Greater economic diversification would reduce their exposure to volatility and uncertainty in the global oil market, help create jobs in the private sector, increase productivity and sustainable growth, and help create the non-oil economy that will be needed in the future when oil revenues start to dwindle. The GCC countries have followed many of the standard policies that are usually thought to promote more diversified economies, including reforms to improve the business climate, the development of domestic infrastructure, financial deepening, and improvements in education. Nevertheless, success to date has been limited. This paper argues that increased diversification will require realigning incentives for firms and workers in the economies—fixing these incentives is the “missing link” in the GCC countries’ diversification strategies. At present, producing non-tradables is less risky and more profitable for firms as they can benefit from the easy availability of low-wage foreign labor and the rapid growth in government spending, while the continued availability of high-paying and secure public sector jobs discourages nationals from pursuing entrepreneurship and private sector employment. Measures to begin to address these incentive issues could include limiting and reorienting government spending, strengthening private sector competition, providing guarantees and financial support for those firms engaged in export activity, and implementing labor market reforms to make nationals more competitive for private sector employment.
Download or read book The World Bank Research Observer written by and published by . This book was released on 2003 with total page 300 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Download or read book Aid for Trade at a Glance 2019 Economic Diversification and Empowerment written by OECD and published by OECD Publishing. This book was released on 2019-07-11 with total page 532 pages. Available in PDF, EPUB and Kindle. Book excerpt: This edition analyses how trade can contribute to economic diversification and empowerment, with a focus on eliminating extreme poverty, particularly through the effective participation of women and youth. It shows how aid for trade can contribute to that objective by addressing supply-side capacity and trade-related infrastructure constraints, including for micro-, small- and medium-sized enterprises notably in rural areas.
Download or read book Guide to Investment Strategy written by Peter Stanyer and published by The Economist. This book was released on 2018-05-08 with total page 352 pages. Available in PDF, EPUB and Kindle. Book excerpt: Now in its fourth edition, this classic guide to investment strategy has been revised to give up-to-date ideas on pensions, investments of passion and more. Peter Stanyer and Stephen Satchell's Guide to Investment Strategy looks at the risks and opportunities of uncomplicated strategies and comes with wealth warnings for those who wish to explore more sophisticated approaches. It explains the importance of insights from behavioral analysis, the principles of traditional finance, and highlights how habitual patterns of decision-making can lead any of us into costly mistakes. After all, markets are most dangerous when most rewarding.
Download or read book Foreign Direct Investment written by I. Moosa and published by Springer. This book was released on 2002-01-29 with total page 328 pages. Available in PDF, EPUB and Kindle. Book excerpt: Foreign direct investment is an important issue that has attracted the attention of academic and professional economists as well as politicians and policy makers. In Foreign Direct Investment , Imad A. Moosa presents a survey of the vast body of literature and ideas relating to foreign direct investment that will be invaluable as a reference work for all these groups. He provides concise definition and analysis of the theories behind foreign direct investment, and considers factors affecting its implementation. The impact of foreign direct investment on economic development, host countries and the growth of multinationals, together with methods for evaluating foreign direct investment projects are discussed. The book is based on the experiences of and the empirical evidence pertaining to foreign direct investment in a large number of countries, and includes case studies on specific projects.
Download or read book International Financial Management written by Arthur I. Stonehill and published by Taylor & Francis. This book was released on 1993 with total page 406 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Download or read book International Economics Global Markets And Competition 3rd Edition written by Henry Thompson and published by World Scientific Publishing Company. This book was released on 2011-04-12 with total page 450 pages. Available in PDF, EPUB and Kindle. Book excerpt: This book integrates the microeconomics of trade with international finance and open economy macroeconomics. The emphasis throughout is on international competition and the limits of trade policy.Economics began with a debate over tariffs. Domestic industries lobby for protection against foreign competitors or export subsidies. Government policy makers dole favors in return for cash and votes. Governments negotiate free trade agreements but disregard them when possible with tariffs, export subsidies, and other policies to influence foreign trade and investment. The forces of international competition, however, eventually overwhelm government policy.This text presents the critical issues of international trade and finance. Trade theory includes partial equilibrium market analysis, neoclassical trade models, constant cost production, factor proportions production, and models of industrial organization. The text integrates concepts from international finance and the basic models of open economy macroeconomics.The presentation uses graphs with numerical examples making the theory easier for students, especially when combined with more general classroom presentation. The text does not assume previous courses in intermediate economics or calculus but develops the theory with simple tools. Numerous questions give students confidence to use the theoretical models and concepts.Over 250 boxed examples illustrate the theory, many with visually descriptive charts and plots. The text is concise in its presentation style. Students enjoy its clear straightforward style and instructors notice the difference on exams.
Download or read book Breaking up the Global Value Chain written by Torben Pedersen and published by Emerald Group Publishing. This book was released on 2017-08-18 with total page 257 pages. Available in PDF, EPUB and Kindle. Book excerpt: Recent developments are challenging the traditional separation between advanced and emerging economies as host of knowledge and production-intensive activities, respectively. Authors assess whether the co-location of R&D and manufacturing is critical for development and innovation.
