Why Diversification Still Matters

I posted The Importance of Diversification chart last year in an article on Callan charts. In 2008, diversification across countries did not work well for investors as the majority of stock markets fell. However that does not mean diversification is dead. Diversification still matters. One can diversify by not only investing in different countries but …

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10 Reasons to Invest in Foreign Stocks

Most American investors have low exposure to foreign equities in their portfolios. There are many reasons for this type of asset allocation strategy. One of them is that financial advisors recommend putting just 10% to 20% of one’s assets in foreign equities. Another reason is due to the “home country bias” inherent in all of …

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Foreign Stocks Beat US Stocks Easily Over Long-Term

For many years US investors turned to foreign stocks for their higher returns, stability and better diversification. Foreign stocks especially European stocks have high dividend yields which helps in the long-term due compounding of returns. An investor who just invests in US equities and ignores foreign stocks will not realize the maximum returns possible. In …

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