International Diversification Through Emerging Market Investment: Selection of Appropriate Portfolio Strategy

In: Review of Pacific Basin Financial Markets and Policies, Band 14, Heft 4, S. 737-749

Abstract

The main purpose of this paper is to compare the performance of portfolio strategies, comprising investments in emerging markets alone, and those strategies of combining investment in emerging and developed markets. The major finding of this paper is: the portfolio strategy combining investment in emerging markets with that in developed markets does not offer any additional value over a portfolio strategy confining investments to the emerging markets only. This paper, therefore, recommends a strategy that emphasizes country selection from emerging markets alone.