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Internationalization of Blue-Chip versus Mid-Cap Stock Indices: An Empirical Analysis for France, Germany, and the UK
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International Diversification, Blue-Chips, Mid-Cap Firms
Very short description for use in the program to help attendees understand more than a title can describe
We analyze the question whether blue-chip indices provide a larger degree of internationalization than mid-cap indices. Specifically, we examine internationalization of blue-chip versus mid-cap indices in France, Germany, and the UK. Investing in an index typically represents a low transaction cost alternative to individual stock picking. Our results show that, overall, both blue-chip and mid-cap stock indices are highly internationalized. Blue-chip index constituents’ degree of internationalization, however, is higher than internationalization of mid-cap indices in Germany and in the UK. The results for France do not exhibit statistically significant differences between blue-chip and mid-cap indices with respect to internationalization.