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- 2011-7-2
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- 2014-6-29
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I am very confused here. according to Schweser:
'Stock market performance. When a country’s financial markets are liberalized, global investors bid up the prices of equities previously unavailable to them. After liberalization, stock returns decline, due to reduced capital costs (required returns). These country level results are also confirmed by examining ADR returns, assuming that the ADR listing is liberalization on a small scale.'
This part confuses me:
'After liberalization, stock returns decline, due to reduced capital costs (required returns). '
According to P= D1/(r-g). Where r is required return and P is Stock returns.
as r drops should P not increase????
please help |
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发表于 2011-7-11 19:13
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