Trade Volatility and the GATT/WTO: Does Membership Make a Difference?

Abdur Chowdhury (), Xuepeng Liu, Miao Wang () and M. C. Wong
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M. C. Wong: University of San Francisco

No 2014-02, Working Papers and Research from Marquette University, Center for Global and Economic Studies and Department of Economics

Abstract: The Bitcoin phenomenon, and the technological innovation that made it possible, is interesting - but for investors large and small, the more pertinent question is whether they should buy the virtual currency or avoid it. We analyze a Bitcoin investment from the standpoint of a U.S. investor with a diversified portfolio. Bitcoin investment shows high average return as well as volatility. Mean-variance Spanning tests show that Bitcoin investment offers significant diversification benefits. Well diversified portfolios with a small Bitcoin component (2%) shows small improvement in the risk-return trade-off.

Keywords: trade volatility; WTO; gravity model (search for similar items in EconPapers)
JEL-codes: F02 F13 F14 (search for similar items in EconPapers)
Date: 2014-01
New Economics Papers: this item is included in nep-int
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Persistent link: https://EconPapers.repec.org/RePEc:mrq:wpaper:2014-02

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