About WiserAdvisor University
WiserAdvisor University is designed to provide you with
high-quality information about investing and finance straight
from those who know best: financial professionals.
The University includes hundreds of informative articles on
dozens of topics of interest to individual investors like you.
If you find an article informative and would like to be contacted
by a financial advisor, we encourage you to fill out our simple form.
The WiserAdvisor service is free, objective, accurate, and confidential,
and will match you to qualified financial advisors who can help you reach your investment goals.
About WiserAdvisor.com
WiserAdvisor.com is an independent and unbiased matching service designed to help individuals find the best financial advisors for their unique needs.
This easy-to-use system prides itself on its simplicity and accuracy. After you fill out a simple form, our algorithms search through the thousands of advisors in our system and provide you with up to three advisors who are best able to help you accomplish your goals.
|
|
|
|
Other Articles
|
|
|
|
|
ETFs
Seeing the World with Your Portfolio
By Anthony Welch
Portfolio Manager, Sarasota Capital Strategies, Inc.
One of the main reasons people invest for retirement is to be able to travel to exotic and interesting places. Exposing your portfolio to far off lands can help make this goal more attainable. The problem is that researching and selecting foreign holdings can be a full time job, leaving little or no time to enjoy the fruits of portfolio success. Fortunately, there are many Exchange Traded Funds to make the task much less daunting.
The first step is an understanding of various risks associated with each opportunity. For example, emerging markets such as Latin America, China, and India can produce tremendous returns, but can also generate huge losses in a short period of time. Developed markets such as Europe, Japan, and Canada also fluctuate, but generally not as much as emerging markets.
The next decision is whether to invest in broad regions such as Latin America or in specific countries such as Mexico and Brazil. Investing in broad regions provides more diversification and reduces specific country risk while investing in single countries can result in a wider range of profits and losses. Also, it is important to note that individual country Exchange Traded Funds can be heavily weighted in a small number of individual companies. For example, the Mexico I-Share (EWW) has almost 25% invested in one stock, America Movil, while the Latin America I-Share (ILF) has less than 12% invested in America Movil and has holdings in four countries instead of just one. One of the benefits of investing in ETFs is a reduction in company specific risk, so an ETF with too much in one company defeats that purpose. To understand why this is important, just think of Enron and Worldcom.
The final step is to determine the amount of your portfolio to be invested in international investments. This percentage is different for everyone as it relies on considerations such as investment goals, time horizons, and risk tolerance.
Investing in foreign stocks has special risks, so proper risk management strategies are very important. However, it’s a big wonderful world out there and you owe it to your portfolio and yourself to explore all the world has to offer.
Click here to submit request>
Go Back to Topic Page>
If you are an advisor and would like to see your articles published, click here
Article reprinted by permission. Unauthorized reproduction of content prohibited.
|
|
|
|
