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If emerging capital markets are efficient, then explain why they often fail to track business cycles (e.g. predictions that emerging capital markets will fall during
If emerging capital markets are efficient, then explain why they often fail to track business cycles (e.g. predictions that emerging capital markets will fall during a recession are often wrong). In addition, use standard portfolio theory to explain why investors should not limit their exposure to emerging capital markets merely due to a fear of large capital losses on so-called speculative investments. (2 page limit) (15 points)
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