Portfolio theory states that if we believe market prices are correct, then the optimal weighting system for a portfolio should be based on market values. Fama and French tackle the question of what happens when you factor in local market distortions that may provide a home market bias.
The answer is messy. But at the end of the day, diversification is what counts.
A Finance Professor's blog. I am a Professor of Finance in the Poole College of Management at NC State University. My website: https://sites.google.com/ncsu.edu/warr Opinions are my own.
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What's going on with inflation?
I recently posted an article on the Poole College Thought Leadership page titled: " What's going on with inflation?" . This w...
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I recently posted an article on the Poole College Thought Leadership page titled: " What's going on with inflation?" . This w...
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