Country-Specific ETFs: An Efficient Approach to Global Asset Allocation
The article shows that country-specific exchange-traded funds (ETFs) enhance global asset allocation strategies.
Author(s):
Professor of Finance, EDHEC Business School
Because ETFs can be sold short even on a downtick, global strategies that diversify risk across country-specific ETFs generate efficiency gains that cannot be achieved by simply investing in a global index open- or closed-end fund. Besides, the benefits of international diversification can be achieved with country-specific ETFs at low cost, with low tracking error and in a tax-efficient way. For all these reasons, country-specific ETFs may be considered serious competitors to traditional country open and closed-end funds.
| Type: | Working paper |
|---|---|
| Date: | le 15/05/2006 |
| Research Cluster : | Finance |
See Also
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Operating from campuses in Lille, Nice, Paris, London and Singapore, EDHEC is one of the top 15 European business schools. Fully international and directly connected to the business world, EDHEC is a school for business, rather than a business school, where excellence in teaching and research focuses on innovation to stimulate entrepreneurship and creativity. EDHEC functions as a genuine laboratory of ideas and produces innovative solutions valued by businesses. The School’s teaching philosophy, inspired by its award-winning research activities, focuses on “learning by doing”.
