closed-end country fund

• immediate diversification within the subject country
• more volatile than their underlying assets due to the added volatility induced by the fund premium to net asset value
• strongly correlated with the U.S. stock market
• inferior substitute for direct investing even for most emerging markets

The closed-end country fund premiums to net asset value:

• very volatile
• add to the risk (but NOT return) of the fund
• decrease as the country liberalizes foreign acces to their financial markets