The reaction of South African markets to the global financial crisis
Date
2011-04-19
Authors
Mpofu, Sithela Vusumuzi
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Abstract
The aim of this research was to explore the impact of the global financial crisis on South African markets.
The results of the research indicate the existence of market linkages between United States and South African markets and that the global financial crisis did have an impact on South African markets. The impact on the financial stocks in S.A. was however, not as significant as that recorded in the U.S.
The findings of the research point to a high degree of correlation at the main index level, which high co-movement is not replicated proportionally at the financial index level. This provides useful information to investors approaching portfolio diversification through use of stock participation in different countries. On an S & P 500 to ALSI level portfolio diversification gains may not be as strong as envisaged but at the S5FINL versus the FINI15 level some opportunity for diversification, albeit still in financial stocks, can be found
Description
MBA - WBS
Keywords
Global financial crisis, South African financial markets, Financial markets, South Africa