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Title:Portfolio Choice and Transactions Taxes PDF Logo
Authors:Haberer, Markus
Issue Date:2003
Series/Report no.:Discussion paper series / Universität Konstanz, Center of Finance and Econometrics (CoFE) 03/09
Abstract:In a simple portfolio choice model of two assets a foreign exchange transactions tax is implemented. We show that the graph in the mu-sigma[square] range is still a parabola and delineate its characteristics for altering tax rates. We presumed a risk avers investor seeking to minimize investment risks by international diversification of two uncorrelated assets. The main finding is that setting up a portfolio under the new tax condition leads to a higher transaction volume on international financial markets. In contrast, the transactions tax has got a stabilizing character when adjusting the portfolio to increased foreign investment risks.
Subjects:International Financial Markets
Portfolio Choice
Risk Diversification
Tobin Tax
Transactions Tax
Persistent Identifier of the first edition:urn:nbn:de:bsz:352-opus-11167
Document Type:Working Paper
Appears in Collections:CoFE-Diskussionspapiere, Universität Konstanz

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