Diversification during Hard Times
Financial Analysts Journal
; 2023.
Article
in English
| Scopus | ID: covidwho-2238833
ABSTRACT
Using a large sample of stocks from 48 developed and emerging markets over 1995 to 2021, we find evidence that suggests that international diversification is the best risk-reduction tool when all markets are considered. However, after the turn of the millennium, industrial diversification is the best alternative for funds limited to developed markets, especially when they are restricted to a region. Importantly, the benefits of diversification persist through hard times, such as the Asian financial crisis, the IT bubble burst, the global financial crisis, and the COVID-19 pandemic, demonstrating their countercyclicality and proving their value when investors need them the most. © 2023 CFA Institute. All rights reserved.
Full text:
Available
Collection:
Databases of international organizations
Database:
Scopus
Language:
English
Journal:
Financial Analysts Journal
Year:
2023
Document Type:
Article
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