Why an indirect exposure approach to international investing may offer the best portfolio benefits

When it comes to investing, many asset allocation models include exposure to an international asset class for increased diversification through what many believe to be an uncorrelated market exposure. Allocations may range anywhere from 5% to 20%, depending on risk tolerance. While this may have been more relevant in the past, in today’s globally connected market, the idiosyncratic risks associated with this asset class may overwhelm any potential portfolio benefit. Today, the correlation argument…

When it comes to investing, many asset allocation models include exposure to an international asset class for increased diversification through what many believe to be an uncorrelated market exposure. Allocations may range anywhere from 5% to 20%, depending on risk tolerance. While this may have been more relevant in the past, in today’s globally connected market, the idiosyncratic risks associated with this asset class may overwhelm any potential portfolio benefit. Today, the correlation argument…

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