The global investment strategy of investing in emerging markets for diversification purposes assumes that the markets are

Question

Quizplus · Accepted Answer

The global investment strategy of investing in emerging markets for diversification purposes assumes that the markets are highly segmented and relatively inefficient compared to the global securities markets. This is because the strategy seeks to diversify away from developed markets, which are considered more efficient and developed, and towards emerging markets which are considered less developed and more prone to market inefficiencies.

The Global Investment Strategy of Investing in Emerging Markets for Diversification