Choose An International Mutual Fund For Gain Or Security

International mutual fund investments can give you the best of many different worlds. You can achieve the stability and security which is inherent in this type of investment, while at the same time searching for the right market to give you the potential for spectacular growth. If you want to invest in industries which are specific to one part of the world, you can certainly do that. You can also choose to avoid any country which has political policies you are in strong disagreement with, as well as areas where environmental considerations are being ignored.

The reasons for investing in mutual funds apply to international mutual funds just as much as to domestic ones, with one possible exception. Although the industry remains government regulated, there is obviously a limit to the jurisdiction the US Government can have over investments in a foreign territory. You will have a degree of protection, but obviously not the same as you would have by sticking to investments within the USA. Historically, though, overseas funds have still proven to be a safe investment.

Some of the same disadvantages apply also, in that you obviously cannot choose your own stocks, any more than you can with a domestic fund. It is less likely, though, that you will regard this as a problem. There are thousands of people who study Wall Street avidly, and who will have their own opinions as to which stocks a fund should be investing in, but it is far less likely that they will have an extensive knowledge of individual stocks based overseas. You will still need to develop a working knowledge of the market you will be investing in, otherwise too much is left to chance.

There are basically two main strategies for overseas investing, depending on your objectives. If you are aggressively seeking the greatest possible gain, you can select the market which you believe is set to grow the most in the shortest time, and invest all of your money into that market. If, on the other hand, you are looking for a more cautious approach, you can spread your investment across many markets with one or more global mutual funds.

Choosing which international mutual fund you want to invest in will first involve quantifying your objectives as clearly as possible. Are you seeking to diversify because you believe another market has a potential for greater gain than the US market, or are you attempting to hedge your bets into a safer market? These considerations will help you to choose a fund, because they will determine the market sectors you should be investing in. You need emerging sectors for growth and established sectors for security, just as much with a domestic fund or an international mutual fund.