Should I Invest in International Stocks?

Should I Invest in International Stocks?

Written by Deepak Bhagat, In finance, Published On
September 13, 2021
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If you are a newbie at investing in stocks or you’ve been in the market for a long time, you know that diversification is key when it comes to investment success. You don’t want to put all your eggs into one basket, whether it be one type of industry, one type of investment, or one particular country.

But too many US investor portfolios are heavily weighted towards the US market and have few international stocks in their portfolio if any. Let’s read on to see why that’s a mistake that needs to be rectified right away!

Should I Invest in International Stocks?

The US Market Is Primarily Focused on Technology

If you look at your stock portfolio, you probably invest in primarily technology-focused stocks, like Google (or Alphabet), Shopify, Netflix, and more.

That makes absolute sense since these companies are doing well and producing great value and returns for their investors. BUT there have been way too many instances of the tech industry going south to ignore that possibility in the future.

One way you can cover some of your losses in such an instance would be by purchasing some foreign stocks. You can do this in a wide variety of ways: 

  • Purchase ETFs (exchange-traded funds) that are focused on foreign stocks
  • Purchase foreign stocks directly
  • Purchase mutual funds that are trade stocks and bonds in foreign markets

As you can see, there are many ways you can start dipping your feet into the foreign stock market bit by bit to start.

The Asian Stock Market Is Predicted to Grow Rapidly in the Coming Years

There are many countries in the Pacific Rim that are looked upon as up-and-coming foreign markets that could be quite lucrative for an investor. The Chinese stock market is definitely considered to be one of them.

The problem with investing only in the US market is that you lose out on boundless growth opportunities. It makes you myopic in your thinking and investments.

Of course, this doesn’t mean that investing in foreign stocks is without recourse or risk. That’s why you need to consider an investment firm like www.monexsecurities.com.au/ (especially if you wish to invest in the Philippines stock market). You don’t have to go at it alone anymore – there are resources out there to help you navigate this new and uncharted terrain.

Start Thinking Outside the Box If You Wish to Retire Sooner – Use International Stocks

Stop limiting yourself and restricting yourself to the US market. There is a world beyond that’s just waiting for you to explore it.

There are hundreds of international stocks that you could research either on your own or with the help of an investment firm and add to your portfolio. This will increase your portfolio’s diversification and reduce your risk of being too concentrated in the US stock market.

If you enjoyed this article, consider browsing other related articles on our website and keep learning!

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