The world's financial markets experienced a strong globalization trend in the 20th century. With the removal of barriers to cross-border flow of capital, financial markets have become truly global during the last two decades of the century. The research papers included in this book study a number of important issues in the world's financial markets. The recent emerging markets crisis, which started in South-Eeast Asia and affected all the world's developed and emerging financial markets, is studied in detail. Another important issue, which receives considerable coverage in the book, is the European financial integration. The financial markets in the United States, Europe, Asia, and Latin America are studied extensively and the linkages between them are analyzed. The objective of the book is to provide the reader with a comprehensive and balanced overview of the world's financial markets at the end of the 20th century.

Portfolio diversification is an important subject for investors. Exchange-traded index funds make it easy for investors to achieve sector and global portfolio diversification. This book explains the risks, returns, and portfolio diversification benefits of sector and global investments. The book consists of six parts and nineteen chapters. In the introductory first chapter in Part I, the authors explain the basics of risk, return, and portfolio diversification. The three chapters in Part II explain the risks, returns, and portfolio diversification benefits of investing in sector index funds. The three chapters in Part III explain the risks, returns, and portfolio diversification benefits of investing in global index funds. The five chapters in Part IV provide empirical evidence for the benefits of global portfolio diversification. The five chapters in Part V provide information regarding the characteristics of firms in different industries and countries. The two chapters in Part VI explain how global stock markets and individual company stocks are affected by stock market crashes.