The Benefits of a Geographically Diversified Investment Portfolio

When investors think about diversifying their portfolios, they usually think about a mix of stocks, bonds, and other investment types. But geographical diversification is just as important, says Ana Elisa Bezerra, LCR Capital Partners’ senior director for Europe. Spreading investments across geographies goes beyond risk mitigation, she says, giving investors access to financial opportunities they would not otherwise know about as well as to investments that may be flourishing and more resilient in some areas of the world than in others. A geographically diverse portfolio allows investors to enjoy the profits of industries doing well in certain countries while the same industries may not do as well in other regions. Geographically, various portfolios perform better over the long term, weathering market downturns and delivering more consistent returns. Savvy global investors also recognize the benefits of a unique non-financial investment: residency in a foreign country. Such investment-by-residency programs (also called golden visas) are emerging as sound, high-value investments for individuals and their families. Offered by countries such as Australia, the United States, and Portugal, these visas allow investors to make a qualifying investment in the local economy in exchange for gaining residency or citizenship in that country. This asset gives investors priceless global mobility and access to economic stability and high-quality healthcare and educational opportunities, thus helping safeguard their wealth and well-being in an uncertain world.

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