Can somebody please explain this answer - and where can I find a reference for this in Schweser or CFAI text.作者: Unforseen 时间: 2011-7-13 16:18
This is pretty much word for word from the book on Emerging markets. Sorry.作者: thommo77 时间: 2011-7-13 16:18
Okay - will have to glance through this again.作者: mik82 时间: 2011-7-13 16:18
The answer key gives you a page reference.
NO EXCUSES作者: PalacioHill 时间: 2011-7-13 16:18
I want to challenge choice C.
What about contagion? That is the result of the spread of crises, so it can happen.作者: Analti_Calte 时间: 2011-7-13 16:18
The correct choice is B.
Contagion will happen in the local (emerging) region - correlation between emerging and developed markets will remain low and hence portfolio will be exposed to minimal risk.作者: nannan66 时间: 2011-7-13 16:18
No, contagion occurs when crisis spread to other countries. Correlations increase in times of crisis. It's right from the CFAI book. Volume 4 Pg 402.作者: wake2000 时间: 2011-7-13 16:18
Yes - but contagion will not necessarily spread to developed countries like UK/US - hence you can diversify the portfolio.作者: mcmc 时间: 2011-7-13 16:18
in reading35
integration leads to price up return down
financing cost down
