[bmitc]

To be specific though, neither of the countries of modern China or Russia existed at those times. In particular, those two dates were revolutionary dates on which entire governments were replaced. There was more going on than just the stock markets.

And as far as I can tell, at least with the Shanghai Stock Exchange, it didn't go to zero in 1950. It was simply closed and liquidated, and that implies that people got back whatever the market value was. That isn't going to zero. I don't know if the money was confiscated by the government or not.

So if one's diversification strategy needs to somehow take into account literal revolution, then I'm not sure how one does that. All bets are off.

[panarky]

Nearly every asset depends on the existing regime for its value.

Public and private corporations are chartered by governments.

Real estate is titled into existence by governments.

Currency and bonds are issued by governments.

When the regime ends, these assets may or may not be recognized by the new regime.

Gold, fine art and crypto are the exceptions to the rule.

[zerbinxx]

In the case of gold or other assets, sure, you can hold it, but the risk (op identifies this) is that you will be killed during the revolutionary war and it won’t matter. Crypto could (and may still be) heavily regulated or even outlawed by states - if they can get you for downloading movies they can get you for your coinbase account. And fine art, too, is subject to sometimes intense state regulation - both in Russia and China international and domestic art trading was severely limited/censored after the revolution.

[beachy]

I think the point is that gold and fine art have value (someone will pay money for them, possibly illegaly) whether or not the regime approves.

Whereas real estate has no value if the state says that it now belongs to someone else.

[jowea]

I've seen diversification strategies that purport to take that into account, generally something like physical gold, investing in yourself and investing in a more stable country while with the investments under the jurisdiction of the more stable country.

And if the exchange was closed and liquidated due to a revolution, who are the investors getting whatever the market value was from?