Registered: Dec 2010
01-30-12 12:49 AM
Quote from nitro:
I am beginning to suspect that the reason is a shift from local economies to international economies. Does this mean that we have to take currency exchange rates into consideration, and therefore how good the company is at hedging [its] currency risk? This is wild, but probably close to the truth. Note that it all boils down to higher dimensional correlates, and their decay.
One idea is to take a companies whose business is strictly local, and see if there is a longer term cointegration in these companies into the present time.
I have a lot of respect for you Nitro, you get me thinking. I have found it interesting, especially more recently, the correlation of the market and currencies. I do believe also that we are experiencing a shift for more local economies to international economies. It's the only thing that seems to make sense.