Low correlation between financial markets of India and the rest of the world is one of the reasons to buy its assets, Bloomberg advises.

Weighted average correlation between Indian currency, bonds and equities with similar instruments in other global economies fell last month to 0,32. This number is very close to 10-year minimum that was set in November. It was 0,68 in 2010. Global investment managers consider this rising difference as opportunity to use this assets class, in order to smooth out returns in their portfolios.

There are a few reasons for such difference: nature of Indian economy, lower sensitivity to global cycle and growing inflows from local investors in recent times.

Disconnection can be well notices at bonds market, where India's 10-year bonds yield is almost not related to portfolio consisting of global sovereign debt.

We cannot say that Indian market is totally isolated from the rest of the world. Geopolitical risks that have shaken emerging markets recently, resulted in growth of bonds yields in this third largest economy in Asia.

Although Indian stocks are more related with global ones than country’s bonds, however this connection has weakened since 2010. It can go even lower after three local exchanged announced this month that they will cut ties with foreign counterparts to maximize trading volumes inside the country.