International Diversification With Frontier Markets

Download or read book International Diversification with Frontier Markets written by Dave Berger and published by . This book was released on 2015 with total page pages. Available in PDF, EPUB and Kindle. Book excerpt: We provide an analysis of frontier market equities with respect to world market integration and diversification. Principal component results reveal that frontier markets exhibit low levels of integration. In contrast with developed and emerging markets, frontier markets offer no indication of increasing integration through time. Furthermore, individual frontier market countries do not exhibit consistent rates of changing integration. Structural break tests identify breakpoints in integration, as well as integration dynamics across countries. We show that frontier markets have low integration with the world market and thereby offer significant diversification benefits.