Abstract:
Portfolio Management has been used as an effective method for evaluating the value of financial
assets and identifying the best obtainable investment scenarios for investors. Portfolio theory
recommend’s that returns can be increased and risks can be reduced by diversifying in
international markets as they have low correlation with domestic markets. This paper examines
the relationship and linkage of Asian subcontinent’s developing markets comprising India,
Pakistan, and Sri Lanka. Research also goes on to establish whether investing in Asian
subcontinent markets will increase diversification benefits or not. The time period of the study is
from 2001 to 2010. It has been observed that lower the co-movement among various global
markets better it is for an investor to diversify in international markets. The results of this study
suggest that the investor from the developed market is better off in investing in mature markets.
