World Regional And Political Risk Influences Upon Asia Pacific Equity Market Returns

Download or read book World, Regional and Political Risk Influences Upon Asia Pacific Equity Market Returns written by Vincent J. Hooper and published by . This book was released on 2008 with total page 12 pages. Available in PDF, EPUB and Kindle. Book excerpt: This paper focuses on the explanatory power of world influences, regional effects and political risk indices on the equity market returns for a selection of Asia Pacific countries. The results support the notion that emerging equity market returns are driven by both regional and global factors. Political risk indices provide little explanatory power over returns. It is discovered that 'regionalism' is a strong influence upon the markets located within ASEAN, and is priced accordingly. Countries whose equity markets are considered to be more open exhibit greater covariability with the world market portfolio. Financial risk indices provide some explanatory power over volatility for roughly half of the sample. The results suggest that emerging market returns may be captured more effectively by multi-index models that incorporate a regional factor and that political risk indices may help in explaining market volatility.