(Harvest) One of the core strategies for portfolio diversification is increasing exposure to international stocks and bonds. This risk reduction strategy is easy to achieve, yet the value of this asset class diversification has diminished over the last few years. The financial cycle has more commonality as measured through times series analysis, and it is harder to achieve the diversification benefits desired if there are more correlated financial cycles.
The Correlation Within The Financial Cycle – Not Good For Those Looking For International Diversification
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