Goods trade and international equity portfolios
By: Fabrice Collard, Harris Dellas, Behzad Diba, Alan Stockman
Contributors: Dellas, Harris, 1958-; Diba, Behzad; Stockman, Alan C.; National Bureau of Economic Research
Series: NBER working paper series -- working paper 13612; Working paper series (National Bureau of Economic Research : Online) -- working paper no. 13612.
Publisher: National Bureau of Economic Research
Published: 2007
Place of publication: Cambridge, MA
Language: eng
Format: [electronic resource] /
Description: "We show that international trade in goods is the main determinant of international equity portfolios and offers a compelling -- theoretically and empirically -- resolution of the portfolio home bias puzzle.  The model implies that investors can achieve full international risk diversification if the share of wealth invested in foreign equity matches their country's degree of openness (the imports to GDP share).  The empirical evidence strongly supports this implication"--National Bureau of Economic Research web site.
Notes: Title from PDF file as viewed on 12/5/2007.

Includes bibliographical references.

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