PDA

View Full Version : Limitations to Asset Market Theory



oussama94
05-29-2017, 00:10
The main limitation of the asset
market theory is that it is untested and fairly new. It is frequently argued
that over the long run there is no relationship between a nation’s equity
market performance and the performance of its currency. See Figure 3.7
for a comparison. Between 1998 and 2008, the S&P 500 index and the U.S.
Dollar Index had a correlation of only 25 percent.