What is international investing and why should I care?

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Diversifying your international investment portfolio is a key part of asset management if you’re looking for long-term growth. Diversification allows an investor to counter the fall of certain sectors and in particular when it comes to investing internationally in stocks and bonds.

International investment in foreign equities is in vogue, and recent emerging economies like India and China offer American investors seeking international investment opportunities an excellent prospect of realizing real returns on their investment. And interest in emerging economies has increased more than ever with the recent boom in automakers, internet companies and electronics companies. While it may seem similar to the internet boom of the early 90s, international fund investing is here to stay.

Investing internationally in funds offers diversification and the biggest advantage of investing abroad is the fact that markets move in different cycles. If there is a downturn in the US economy, another foreign country would rise and so having a portfolio of more than one country allows you to counter market volatility and reduce your overall risk.

Interestingly, international funds over the past 5-10 years have performed significantly better than US equity funds. The advantage is undoubtedly the diversification of international investment opportunities and international funds offer higher returns on your assets.

For investors who are willing to take risks, investing internationally in emerging markets is a great idea. Countries like Brazil, Thailand and Indonesia offer investors huge returns but also some risks that come with it. It is very important to remember not to be overexposed to any particular fund when diversifying for asset management purposes. As a general rule, you shouldn’t expect to get 15% or more in your portfolio.

You also have the possibility of diversifying your wealth within international funds. There are many types of investment vehicles that give you the opportunity to create a diversified portfolio. Look for small, mid and large cap stocks from around the world, from various emerging countries like China to highly industrial and established economies like Japan. You can also invest internationally in the form of real estate investment trusts and buy property like another stock or commodity.

Asset management should help you diversify your portfolio and be a good way to seek international fund management investments.



Source by Deshea R Witcher

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