Interdependence of South Asian & developed stock markets and their impact on KSE (Pakistan)

Authors

Safdar Hussain Tahir, Government College University, Faisalabad, Pakistan
Hazoor Muhammad Sabir, Government College University, Faisalabad, Pakistan

Abstract

The objective of this study was to investigate the interdependence among the South Asian and developed markets and their impact on Karachi Stock Exchange. The data was collected from eight worldly stock exchanges, four from each South Asia and developed countries for the period starting from July 1999 to June 2011. For analytical purposes, techniques like Correlation Matrix, Unit root, Co integration test and Granger Causality were applied. The correlation results indicated that there was no significant relationship between the South Asian and developed equity markets. However the equity market of US and India found to be correlated. A bidirectional casual relationship was found between CSE and KSE through Granger Casual test. The Equity Markets of South Asia and Developed countries are not co integrated with each other. The international portfolio managers are advised to include Karachi Stock Markets in the developed market portfolios, because the Karachi Stock Market is not linked with the Developed world.

Keywords

Stock exchange, South Asian, Developed markets, Interdependence

DOI

https://doi.org/10.54784/1990-6587.1218

Creative Commons License

This work is licensed under a Creative Commons Attribution 4.0 International License.

Recommended Citation

Tahir, S. H., & Sabir, H. M. (2013). Interdependence of South Asian & developed stock markets and their impact on KSE (Pakistan). Business Review, 8(1), 85-93. Retrieved from https://doi.org/10.54784/1990-6587.1218