This analysis contains estimates of the global, country and sector factors affecting stock returns. These factors are "pure" returns in the sense that differences across countries in sector composition, and differences in composition of countries making up sectors, are "taken out."

For example, a country factor is the return that we estimate would have been realized on stocks in the country index if each country had had the same sector composition. * Likewise, the sector factors are the estimated returns on sectors if all countries were equally represented in the sector.

* For example, a high return on Australian stocks last week may have been due to an Australian factor like lower Australian interest rates which affect stocks of companies domiciled in Australia, or simply because Primary Resource stocks had a high return and Australia is weighted toward resource stocks. Or if Swiss returns are high, you don't know whether to attribute the high return to Swiss country policies, or perhaps to high returns in Banking and Financial stocks in which Switzerland is heavily weighted. ExplanationDate Updated