Diversification is one of the simple and effective way to reduce risk and increase potential returns. Putting all eggs in one basket is a recipe for disaster.It is important to diversify not only among asset classes, but also between sectors when investing in stocks, between countries, regions, etc. The first decade of the 21st century …
Volatility is back with a vengeance in the US equity markets. In the first two weeks of this year stocks have been extremely volatile with the Dow taking investors on a wild ride.In times of such high volatility patience is a very important factor that differentiates successful investors from others. Panic selling and market timing does …
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When investors think of Latin American countries for investment they usually tend to gravitate towards Brazil and Mexico, two of the largest economies in the region. However Brazilian equities have been average to poor performers in the past few years and the Mexican economy is highly related to the performance of the U.S. economy. Instead of focusing mainly …
Investing in emerging market equities is fraught with risks.Unlike the developed world developing countries are prone to suffer from a myriad of risks including currency exchange risk, political risk, liquidity risk, transparency risk, etc. Investors looking to gain exposure to emerging markets should be aware of these risks and take extra precaution before jumping in. Five …
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One of the myths among investors is that economic growth influences the growth of equity markets.However this is not true. Study after study has confirmed that there is no relationship between economic growth and equity markets growth. This is because stocks can rise for a multitude of reasons which have nothing to do with economic …
Continue reading ‘On The Relationship Between Economic Growth and Stock Market Returns’ »