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In Search of Risk Havens in the Global South—Interconnectedness Between Mining Stocks and Energy Commodity Future

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  • Rabindra Nepal
  • Miklesh Prasad Yadav
  • Nidhi Malhotra
  • Ravinder Verma
  • Silky Vigg Kushwah

Abstract

This article examines the decomposed connectedness of mining stocks of the Global South nations with energy commodity futures. We consider the major mining stocks of the Global South like Vale S.A. (Brazil), Hindustan Zinc (India), PT Bumi Resources (Indonesia), and China Shenhua Energy Co. (China) while crude oil futures represent the energy commodity futures. We consider daily observations extending from December 31, 2019, to November 30, 2023, for our empirical investigation. We employ R2 decomposed connectedness and find that the total connectedness index (TCI) is 62.30% which is attributed to evenly to contemporaneous interdependencies as well as lagged dynamics. We also find that the Indonesian stock (PT Bumi Resources) is a safe stock to mitigate the risk which is advisable to be held by investors for portfolio diversification. This study furnishes insight to investors, portfolio managers, and policy analysts.

Suggested Citation

  • Rabindra Nepal & Miklesh Prasad Yadav & Nidhi Malhotra & Ravinder Verma & Silky Vigg Kushwah, 2025. "In Search of Risk Havens in the Global South—Interconnectedness Between Mining Stocks and Energy Commodity Future," Emerging Markets Finance and Trade, Taylor & Francis Journals, vol. 61(8), pages 2206-2223, June.
    • Handle: RePEc:mes:emfitr:v:61:y:2025:i:8:p:2206-2223
    DOI: 10.1080/1540496X.2024.2420599
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