Summary of An Industrial Organization Approach to International Portfolio Diversification

Looking for the report?
We have the summary! Get the key insights in just 5 minutes.

An Industrial Organization Approach to International Portfolio Diversification summary
Start getting smarter:
or see our plans

Rating

7 Overall

7 Importance

8 Innovation

6 Style

Recommendation

Mutual funds are not immune from “home bias” – the tendency of investors not to venture outside their local markets. Economist Chae Hee Shin of the Federal Reserve reveals what may be behind this financial xenophobia. While this study provides new insights into why many US mutual fund families stick to certain parts of the globe, it fails to mention such pertinent factors as the relative performance of global markets or the increased use of indexing strategies that emphasize market-capitalization weightings. Nonetheless, getAbstract recommends this eye-opening analysis to financial industry professionals and investors everywhere.

In this summary, you will learn

  • Why US mutual fund companies constitute a significant investment channel for retail and institutional investors, and
  • Why many mutual fund families underdiversify internationally.
 

About the Author

Chae Hee Shin, an economist at the Federal Reserve Board of Governors.

 

Summary

Millions of private and institutional investors invest through US mutual fund companies, thanks to funds’ relatively low costs, liquidity and ease of diversification. In 2013, 46% of American households used mutual funds, which held 29% of all US corporate shares. Fund firms offer insights into how ...

Get the key points from this report in 10 minutes.

For you

Find the right subscription plan for you.

For your company

We help you build a culture of continuous learning.

 or log in

Comment on this summary

More on this topic

Customers who read this summary also read

More by category