Background: Investing internationally is easier than ever before, with the rise of the internet, unification of accounting standards, and faster flow of information. Yet, many argue that due to increasing global equity market correlations, it is getting increasingly hard to attain benefits from international diversification. Therefore, it is important to know if there are any benefits attainable from international diversification for Swedish investors.

Purpose: The purpose of this thesis is to investigate if there are any benefits achievable from international diversification for Swedish investors, if those benefits have changed from before and after the financial crisis in 2007/2008, as well as where Swedish investors might attain the greatest benefits from diversification; namely in developed- or emerging markets.

Method: Correlations are measured over the time periods before and after the financial crisis, using both a 61-month correlation window (the entire periods) as well as a 12-month rolling correlation window.  To test diversification benefits, different portfolios are created using the Markowitz Portfolio Optimizer, such as a Maximum Sharpe portfolio and an Equal Weighted portfolio.

Conclusion: Correlations have increased from before and after the financial crisis, both for developed- and emerging markets. Diversification benefits exist for Swedish investors, but they have decreased from before and after the financial crisis, and they appear slightly greater in emerging markets than in developed markets.