TY - JOUR T1 - Return Orthogonality and True Diversification Benefits of BRIC Securities JF - The Journal of Index Investing SP - 75 LP - 79 DO - 10.3905/jii.2019.10.1.075 VL - 10 IS - 1 AU - Javier Rodríguez Y1 - 2019/05/31 UR - https://pm-research.com/content/10/1/75.abstract N2 - In this study, the author examines and compares the US market risk exposure and true diversification benefits of emerging markets closed-end funds and exchange-traded funds. The author uses a two-factor econometric model and orthogonal returns to isolate both, US direct market risk and true diversification. Results show that exchange-traded funds that invest in emerging markets are a better vehicle for US-based investors to gain international diversification. In comparison to closed-end funds, exchange-traded funds provide truer international diversification and have less exposure to US market risk.TOPICS: Mutual fund performance, exchange-traded funds and applications ER -