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Assuming you are a stock investor looking for opportunities in global equity market. Here's the link to data onrisk premium at country level http://pages.stern.nyu.edu/~adamodar/New_Home_Page/datafile/ctryprem.html Based

Assuming you are a stock investor looking for opportunities in global equity market. Here's the link to data onrisk premium at country level

http://pages.stern.nyu.edu/~adamodar/New_Home_Page/datafile/ctryprem.html

Based on the data,

  • (a) Which country has the highest default rate, and which country has the highest country risk premium?
  • (b) Which two, or threecountries will you choose for your global equity portfolio and what's the weight, by percentage, you are going to allocate to each country's stock? (Hint: there is no standard answer to this question. It's based on your individual risk tolerance and preference. As you learned in class - higher risk, higher expected return; lower risk, lower expected return).

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