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- The top plot of the figure displays the cumulative, equally-weighted average equity return (black thick line) separately computed across EMU countries (left plot), Developed markets exEMU (middle plot), and emerging markets (right plot). The vertical dotted lines mark the end of the periods considered. We note broadly similar patterns across groups, with a sharp decline in valuations during the crisis followed by a recovery towards the end of 2010, the turmoil of the European sovereign debt crisis (which is especially pronounced in EMU countries), and the increase in valuations in the last part of the sample reaching levels above the pre-crisis period. To give a sense of the cross-sectional distribution within countries of a given group, we plot the cross-sectional standard deviation (blue dotted line) on a common scale across the three groups.
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