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Risk Involved in International Debt Investment in Emerging Markets : A Case Study of India, Malaysia and Taiwan

The purpose of this research paper is to find how much risk is involved in investing emerging market debt. Emerging markets are becoming a hub for foreign investors either that is an equity or debt investment. The risk is the important element for investors. As for emerging markets the most important risk that investor can face is exchange rate and political risk. I used Augmented Dickey-Fuller to carry out unit roots and johansen cointegration analysis of exchange rates and political risk in emerging markets. My result shows that individual variables are integrated order one, means unit root exist. This shows that political risk tends to follow a random walk. My finding suggests that there is a long run relationship between political risk and exchange rate. As the political risk increase exchange rate also fluctuate with relation to political situation.

Identiferoai:union.ndltd.org:UPSALLA1/oai:DiVA.org:his-1475
Date January 2008
CreatorsSuleman, Muhammad Tahir
PublisherHögskolan i Skövde, Institutionen för teknik och samhälle
Source SetsDiVA Archive at Upsalla University
LanguageEnglish
Detected LanguageEnglish
TypeStudent thesis, info:eu-repo/semantics/masterThesis, text
Formatapplication/pdf
Rightsinfo:eu-repo/semantics/openAccess

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