Prospects for International Portfolio Diversification: Linkages Between the Ghanaian Equity Market and the World's Major Markets

Abdulsalam Alhassan ()
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Abdulsalam Alhassan: Youngstown State University (YSU)

The African Finance Journal, 2006, vol. 8, issue 1, 1-13

Abstract: Despite increased co-movements in stock performance among developed economies, international portfolio investors have failed to diversify into African stock markets. Is the persistence of home bias in equities due to a possibility that African markets move in tandem with the rest of the world? This paper investigates linkages between the Ghanaian equity market and the world’s major markets using co-integration and error correction analyses. There is no evidence of linkages between the Ghanaian equity market and the world major equity markets. Results are conclusive for both short and long run relationships. Ghana therefore offers the potential for international portfolio investors.

Keywords: Co-Integration; Error Correction; International Portfolio Diversification; Ghana Stock Exchange (search for similar items in EconPapers)
JEL-codes: F30 F36 G15 (search for similar items in EconPapers)
Date: 2006
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Persistent link: https://EconPapers.repec.org/RePEc:afj:journl:v:8:y:2006:i:1:p:1-13

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