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why should investors consider constructing global portfolios? As part of your response, be sure to address currency fluctuation concerns.
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- why should investors consider constructing global portfolios?how do currency fluctuation concern s affect that decision?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.Which 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 risk
- As the investment manager of the Oman investment fund, you wish to have a well-diversified international bond portfolio? What types of risks can be reduced by investing in such a portfolioMultinational 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.If the firm had exposures in currencies such as Brazilian Real or Indonesian Rupiah,what options does the firm have in terms of hedging/foreign exchange risk management?
- Explain why would a firm consider investing in a portfolio of foreign currencies instead of just a single foreign currency?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 riskCompare each factors affecting international portfolio investment and search for examples