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International Portfolio Diversification

I need help on this assignment
I have to write it about international Portfolio Diversification.

1. Prepare the paper in which you explain at least three benefits of international portfolio diversification.

2. Discuss how three different global funds have used the concept of international portfolio diversification to successfully invest.

Please properly cite your references. Thanks.

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I need help on this assignment
I have to write a 1200 essay about international Portfolio Diversification.

1. Prepare the paper in which you explain at least three benefits of international portfolio diversification.
The first benefit of international portfolio diversification is that there is greater safety of investment. The investments in countries abroad may be related to the domestic market volatile ness. Further, a change in the business climate may lead to a situation where a part of the investment has to be written off. If there is an investment portfolio that is well diversified, then the company has to bear limited loss. An investment in a country may be hit by the policies of the local government. An investment may unexpectedly reduce in its value. Further, investments in the global arena are sometimes hit by international risk factors like natural calamities, terrorism or government changes. The net result is the same, an investment that cannot fully be recovered. In this context, the benefit of international portfolio diversification would be that there is safety from the risk of investment loss.
The second benefit of international portfolio diversification is that of uncovering a new class of companies. if diversification is practiced in global investments, the investor can take advantage of high-quality foreign companies. There are several companies, especially in the emerging economies which offer the opportunities of higher than normal returns. These companies have high growth and profitability rate. Diversification enables a global investor to reap benefit from these new -class companies. Overall the benefit that the investor gets from investing in these new classes of companies is to include new class companies in different countries so that the investor can benefit from their performance.
The third benefit of international portfolio diversification is that the higher overall returns on investment. if the US markets are down, the foreign markets may be up and increasing. Similarly, when one foreign market is down the US market may be increasing. It has been observed that globally diversified portfolios earn far higher incomes than portfolios that are not diversified. Today, a US investor has the opportunity to invest not only in the US but also in the UK, European Markets and Asian markets. Similarly, the global investor has the opportunity of ...

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