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Equity Risk Premium Please read this article http://www1.worldbank.org/finance/assets/images/Equity_Risk_Premiums.pdf It is easy for find the data on each country's equity risk and country risk premium, http://pages.stern.nyu.edu/~adamodar/New_Home_Page/datafile/ctryprem.html

Equity Risk Premium

Please read this article http://www1.worldbank.org/finance/assets/images/Equity_Risk_Premiums.pdf

It is easy for find the data on each country's equity risk and country risk premium,

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

please answer the following two questions:

1. What is the implication of this data, i.e. which country has the highest default rate, and which country has the highest country risk premium? Why?

2. If you are an investor interested in Global Equity Portfolio, which two, or three countries will you choose? Why? What's the weight (by percentage) you are going to allocate to each country's stock?

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