Principal Component Analysis

Diversification measures and the optimal number of Stocks in a portfolio: An information theoretic explanation

This paper provides a plausible explanation for why the optimum number of stocks in a portfolio is elusive, and suggests a way to determine this optimal number. Diversification is dependent on the number of stocks in a portfolio and the correlation structure. Adding stocks to a portfolio increases the level of diversification, and consequently leads to risk reduction. However the risk reduction effect dissipates after a certain number of stocks, beyond which additional stocks do not contribute to risk reduction.

The Impact of Basic and Social Infrastructure Investment on Economic Growth and Social Development in South Africa’s Urban and Rural Municipalities

Basic and social infrastructure investment can assist in addressing widespread inequality and divided societies by promoting economic growth and social development. The aim of this study is to determine whether basic and social infrastructures investment differently affect economic growth and social development indicators of urban and rural municipalities. We used a balanced panel dataset containing infrastructure, economic, demographic and social indicators for rural and urban municipalities for the period from 1996 to 2012.

Financial Reforms and Consumption Behaviour in Malawi

The purpose of the study is to examine whether financial reforms implemented in the 1980's and 1990's altered the pattern of aggregate consumption behaviour in Malawi. More specifically, the study questions whether financial reforms affected consumption behaviour by reducing the excess sensitivity of changes in consumption to changes in current income using the Permanent income hypothesis (PIH) framework. If it happens that excess sensitivity does not reduce, the paper explores further whether the failure is due to liquidity constraints or myopia.

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