Emerging Market Portfolio Flows : The Role of Benchmark-Driven Investors /

Portfolio flows to emerging markets (EMs) tend to be correlated. A possible explanation is the role global benchmarks play in allocating capital internationally, the so-called 'benchmark effect.' This paper finds that benchmark-driven investors indeed play a large role in a key segment of...

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מידע ביבליוגרפי
מחבר ראשי: Arslanalp, Serkan
מחברים אחרים: Tsuda, Takahiro
פורמט: כתב-עת
שפה:English
יצא לאור: Washington, D.C. : International Monetary Fund, 2015.
סדרה:IMF Working Papers; Working Paper ; No. 2015/263
גישה מקוונת:Full text available on IMF
תיאור
סיכום:Portfolio flows to emerging markets (EMs) tend to be correlated. A possible explanation is the role global benchmarks play in allocating capital internationally, the so-called 'benchmark effect.' This paper finds that benchmark-driven investors indeed play a large role in a key segment of the market-the EM local currency government bond market-, accounting for more than one third of total foreign holdings as of end-2014. We find that the prominence of these investors declined somewhat after the May 2013 taper tantrum, but remain high. This distinction is important in understanding the drivers of EM capital flows and their sensitivity to different types of shocks. In particular, a high share of benchmark-driven investors may result in capital flows that are more sensitive to global shocks and less sensitive to country factors.
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תיאור פיזי:1 online resource (25 pages)
פורמט:Mode of access: Internet
ISSN:1018-5941
גישה:Electronic access restricted to authorized BRAC University faculty, staff and students