PRINCIPLE #4: AVOID HOME COUNTRY BIAS
WHAT'S THE DOWNSIDE TO BUYING LOCAL? CHOICES ARE LIMITED.
Where we live and work can influence the way we shop. That’s why it’s important for investors to stick to a plan that carries global opportunities. See how we’re thinking about giving portfolios access to the global markets.
While the United States still boasts the single largest economy in the world, it accounts for only a small fraction of global GDP and just over 35% of the world’s capital markets. Yet, statistics show that U.S. investors have nearly 75% of their investments in U.S.-based assets.
Familiarity bias and concentrated positions
Our investment biases show up in other ways too. Where we live, and even our field of expertise, can influence the way we allocate our assets. It is important that investors are aware of these biases and employ a disciplined investment plan that can help minimize their influence.
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DON'T JUST BUY THE WORLD, BUY THE BEST PARTS
Not all international investments are created equal. We can help you find the best opportunities for growth, while managing volatility.
Diversification does not guarantee investment returns and does not eliminate the risk of loss. Diversification among investment options and asset classes may help to reduce overall volatility.