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What are the benefits of international portfolio diversification? Outline the arguments in favour of diversifying internationally than domestically. Discuss the possible reasons why securities are much less correlated across countries than within a country.
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- Discuss and illustrate how the following barriers affect diversification of portfolios into international markets: Segmented markets Exchange rate controls Less developed capital markets Exchange rate riskWhich is a benefit of including international stocks in an investment portfolio? A. Greater ability to diversify B. Political risk exposure C. Exchange rate risk D. Financial riskFrom a practical standpoint, how do international markets differ from domestic markets? What role do international securities play in a corporate portfolio? In what ways do investors quantify the risk levels between domestic and foreign securities? What asset allocation strategies and weightings would you consider when investing in international securities? Explain your reasoning.
- What factors are responsible for the recent surge in international portfolioinvestment?Multinational companies, international portfolio diversification are known to offer moreopportunities than a domestic portfolio. Further, they have more stable returns despitehaving more diffuse risk.Required:A. What factors are responsible for the recent surge in international portfolioinvestment?B. Explain the main barriers to international portfolio diversification.C. Discuss the advantages and disadvantages of investing in emerging economies.Identify an economic crisis or turning point that had significant impacts to certain industries in the U.S. market. Explain why investing in international markets can be a good strategy to hedge against this.Why is maintaining a portfolio that contains foreign securities considered a good long-term investment strategy?
- In what ways do investors quantify the risk levels between domestic and foreign securities? What asset allocation strategies and weightings would you consider when investing in international securities? Explain your reasoning.why should investors consider constructing global portfolios? As part of your response, be sure to address currency fluctuation concerns.Investing imbalance in global markets is a process of international diversification with the asset allocation, theoretically, the benefits of this portfolio strategy may include ( ).A higher SD (Standard Deviation); B lower SD; C higher Sharpe ratio; D lower Sharpe ratio; E broader asset options. (Many answers are valid)
- Which of the following statements is the MOST accurate? A) International trade in assets can make both parties to the trade better off by allowing them to reduce the riskiness of return by portfolio diversification. B) International trade in assets can make both parties to the trade worse off by allowing them to increase the riskiness of return by portfolio diversification. C) International trade in assets can make both parties to the trade worse off by allowing them to eliminate all risk by portfolio unification. D) International trade in assets can make both parties to the trade better off by allowing them to eliminate all risk by portfolio unification. do not plagiarise please thnkualthough it is important to consider the impact of inflation on investments made within one country, it is especially important to do so in multinational investment situations true or false?Made sure you differentiate portfolio investments from FDI. Can we argue that a "A closed economy, however, is entirely self-sufficient", or if it is, at what costs? An open economy is one that engages in international trade of goods, services, and financial assets. An open economy participates in a variety of trade activities with foreign nations. A country's market can be expanded in a way that a closed economy can never do. It buys shares, debentures, bonds, and other types of securities from foreign nations and sells them to countries abroad. Normal people of an open economy are free to travel and work wherever they wish in that economy's domestic boundaries. A closed economy, however, is entirely self-sufficient, which implies that neither imports nor exports ever leave the nation. The objective of a closed economy is to provide all domestic consumers' needs from inside its boundaries. It does not import goods or services from other nations or export goods or services to them.…