You have the option to invest in either country A or country B but not both. You

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You have the option to invest in either country A or country B but not both. You carry out some research and conclude that the two countries are similar in every way except that the returns on assets of different classes tend to move together much more in country A– that is, they are more highly correlated in country A than in country B. Which country would choose to invest in and why?

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Money Banking and Financial Markets

ISBN: 978-0078021749

4th edition

Authors: Stephen Cecchetti, Kermit Schoenholtz

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