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Please use this identifier to cite or link to this item:
http://hdl.handle.net/2451/26093
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| Title: | Does Microfinance Form a Distinctive Asset Class? Preliminary Evidence |
| Authors: | Walter, Ingo
Krauss, Nicolas |
| Keywords: | microfinance
systemic risk
poverty alleviation |
| Issue Date: | 2006 |
| Series/Report no.: | EC-06-31 |
| Abstract: | Microfinance is arguably one of the most effective techniques for
poverty alleviation in developing countries. Although traditionally
supported by nongovernmental organizations and socially-oriented
investors, microfinance has increasingly demonstrated its value on a
stand-alone basis, typically exhibiting low default rates combined with
attractive returns, encouraging greater commercial involvement. This
paper addresses a related issue whether microfinance represents a
distinct financial asset class, thereby forming the basis for access to
global capital markets and performance-driven investors in their search
for efficient portfolios. Our empirical tests generally show very low
correlations between the performance of microfinance institutions and
global and national market performance measures, suggesting that
microfinance portfolios may constitute a distinct asset class that can
have useful portfolio diversification value. |
| URI: | http://hdl.handle.net/2451/26093 |
| Appears in Collections: | Economics Working Papers
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