Introduction Diversification is a method of investing that been shown to increase portfolio return while reducing portfolio risk as measured by standard deviation. This method specifically increases the efficient frontier for investors. The challenge to an investing firm is an appetite by its customers for an ever increasing efficient frontier. One area to explore to obtain this increase is through further diversifying through international diversification. International portfolio diversification gives
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INTERNATIONAL DIVERSIFICATION There is a basic principle in finance and portfolio management‚ and this is‚ to obtain the greatest benefits with the resources available‚ this principle leads to a fundamental problem‚ which is to determine which assets should be invested to maximize the profitability of the capital available. Previously was limited when it comes to investing insight‚ which consisted of single and only an investment in domestic assets‚ today the borders of investment have expanded
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DIVERSIFICATION AND FIRM PERFORMANCE: AN EMPIRICAL EVALUATION Anil M. Pandya and Narendar V. Rao Abstract Diversification is a strategic option that many managers use to improve their firms’ performance. This interdisciplinary research attempts to verify whether firm level diversification has any impact on performance. The study finds that on average‚ diversified firms show better performance compared to undiversified firms on both risk and return dimensions. It also tests the robustness of these
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Running head: INTERNATIONAL PORTFOLIO DIVERSIFICATION International Portfolio Diversification International Portfolio Diversification Globalization resulted‚ among other things‚ in a noticeable increase in foreign trade and investment worldwide. For individuals‚ the main type foreign investment is foreign portfolio investment (or foreign indirect investment) which is “the investment by individuals‚ firms‚ or public bodies (e.g.‚ governments or nonprofit organizations) in foreign financial
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Diversification Strategies in the Global Retailing Industry: Essays on the Dimensions and Performance Implications DISSERTATION of the University of St. Gallen‚ School of Management‚ Economics‚ Law‚ Social Sciences and International Affairs to obtain the title of Doctor of Philosophy in Management submitted by Timo Sohl from Germany Approved on the application of Prof. Dr. Thomas Rudolph and Prof. Dr. Günter Müller-Stewens Dissertation no. 3987 Difo-Druck GmbH‚ Bamberg 2012
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Why firms go international? There are many reasons can promote firms go international‚ includes the domestic market saturation‚ end of PLC in domestic market‚ geographic diversification‚ to gain the economies of scale‚ stiff competition in domestic market and absence of competitors overseas etc. 1. Some firms go international in order to gain the economies of scale. As a research has pointed out that a doubling of output can reduce the production costs by up to 30 per cent. This is very obvious
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SYMBIOSIS INSTITUTE OF MANAGEMENT STUDIES MARKETING MANAGEMENT PROF V.V Ramasastry “Research Paper- Diversification leads to success?” Submitted By- Anil -15
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Diversification is a good way to increase profits‚ create more value or reduce market risks from having only one or few product lines. As such‚ different companies diversify for various reasons‚ and therefore‚ diversification can be either related or unrelated. However‚ not all the companies succeed when choosing diversification as part of their corporate strategy. Like everything else‚ diversification does come with its ups and downs. Diversification can be beneficial‚ but probably up to a certain
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The Advantages of Global Expansion Many companies have moved into other countries because they saw huge growth opportunities there. Recent interviews of top international executives by the Myrddin Group in San Antonio have revealed they thought they could create value by transferring their business model and American style of product and marketing to foreign markets. Many initially treated foreign markets much like the United States but soon found that this was not the correct approach. Many
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proves the hypothesis of marketing: - Related diversification is a more successful strategy for growth among firms than unrelated diversification. It explains the concept of diversification‚ the rationale of diversification‚ types of diversification‚ diversification strategies‚ and dimensions of diversification. This paper analyses the given hypothesis using various examples and reaches a conclusion. Keywords Related‚ unrelated‚ diversifact‚ diversification‚ diversifame‚ diversifad‚ diversifriction
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