Investing in international markets...is it worth it?

Hi everyone!!! :handshake:

Historically, U.S. stock market has outpaced international equity markets by a wide margin, raising persistent questions about whether it still makes sense to invest in non-U.S. markets. However, 2020 has been a really different year for everyone out there with big news affecting international markets, markets crash, several assets reaching their ATH while others are barely supporting their own weight…

In the name of diversification i think it makes sense to invest in some international markets out there together with US stock market assets. Even SEC (Securities and Exchange Commission) generally consider international investments beneficial, in terms of diversification of portfolio, reduced volatility and growth potential, however, buying foreign stocks is not free of risks and if we take into consideration the actual pandemic scenario maybe looks really “too risky” to invest in foreign markets…so do you think is it worth it or not?

P.S: words and thoughts expressed here must be just taken into consideration with informational and educational purposes and not as an investment advice!!!

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I have the majority of my money invested in mutual funds. There are many funds within that company for me to choose from. During my last review of my investments (I think in May 2020), I did consider investing in an international fund but when I compared it to some of the other funds, it does not perform as well long term. It also didn’t get as high a rating as some of the domestic funds. I chose not to invest it in because my goal is long term growth. However, as we all know, everyone has different investment goals, so international funds may benefit some portfolios.

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It’s definitely a worthy option, at least in terms of diversification and volatility, as you mentioned. But I think in a broader sense, as of 2020 one must account for the future position of the dollar as a reserve currency… I will not venture to say what will happen with that in the long term, just to say that lately there are lots of voices predicting the beggining of the end for the USD… Certailny your beleifs about that would weight heavily when investing (short or long) in international markets nowadays

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Investment advisers like to say, “past performance is no guarantee of future returns”, and this is very true. I think there is always a risk into any investment we made. Living is risky after all :slight_smile:

US Stock Market has shown more than 10 years of strength. The following chart shows U.S. shares, using the S&P 500 vs. the MSCI All Countries Index (minus the U.S.) as a benchmark, far outperformed shares in the rest of the world over the last decade.

MFvs-Wrld123019-249x300

It is really impresive but i have always think that we cannot bet to a single player, no matter how successful he is. So, given the actual pandemic status i think it worth a try in order to diversify a given portfolio to test some international markets, after all international markets have not shown significant losses, only minor gains compared with US markets… small gains are still gains after all :money_mouth_face: :sweat_smile:

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