Diversification is one of the simplest and easiest strategies that retail investors can follow to protect their portfolios from high volatility. Holding a wide variety assets across regions and countries and sectors and avoiding timing the market would go long in generating high returns. Trying to predict which sector will be winner during the next …
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The S&P 500 Index is not as diversified as many investors think. In fact, the IT sector alone accounts for just over 25% of the index and the weightage of the defensive sector has fallen continuously since the 1990s. S&P 500 sector breakdown: Click to enlarge Source: S&P The defensive sector used to account for …
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Many multi-national firms based in the developed world have substantial exposure to overseas markets than their domestic markets. In fact, some derive a big portion of their revenue and earnings in foreign countries than their home countries. For instance, BHP Billiton Ltd is a FTSE 100 firm in the UK. However the mining giant earns …
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The three largest index providers in the world are S&P DJI, MSCI, and FTSE Russell. For emerging markets, the MSCI Emerging Markets Index is the most popular and widely used benchmark globally. Though MSCI and S&P indices are similar there are significant differences between the indices offered by these companies. It is important to understand these …
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Single country funds are highly risky especially those related to emerging markets. Holding these funds for the long-term defined as five years or more requires strong conviction and patience and there is no guarantee that the bet would be a winner. I recently came across an article that discussed the risks and benefits of investing …
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