European emerging markets offer better diversification than frontier markets for investors.
The article investigates the relationship between different types of stock markets in Europe. By using specific tests, the researchers found that emerging markets in Europe are separate from developed markets, while frontier markets are closely connected to developed markets. This means that investing in emerging markets can provide good diversification opportunities for long-term investors. The findings challenge the idea that only big markets influence smaller ones, and can help global investors make better investment choices.