Experts say global and international mutual funds can represent a world of opportunity for investors.
Foreign-based companies now comprise fully half of the world's equity
market capitalization, up from about one-third in 1970, and many key
industries such as oil and gas, wireless telecommunications and
building construction are dominated by foreign companies.
However, despite the investment opportunities presented by these
companies, research shows that international stocks remain
significantly underrepresented in most U.S. portfolios. It's estimated
that on average Americans hold only about 5 percent of their portfolios
in foreign stocks and funds.
Even if they do not realize it, the lives of Americans are influenced
by global companies. Perhaps it was the medication taken before
bedtime, the car driven to work or the soft drink that accompanied
lunch. All are likely to have been products of companies that operate
beyond the U.S.
According to ING Funds, the U.S. retail mutual fund unit of ING Group,
one of the largest financial service organizations in the world,
international equity markets offer investors exposure to many key
industries that countries other than the U.S. dominate.
The mutual fund unit has recently embarked on a "Going Global" campaign to introduce more people to international investing.
"ING is working hard to help more people understand how the world of
investing is changing," said Bob Boulware, president and CEO of ING
Funds. According to Boulware, "Those that are not thinking globally may
be missing out."
Just as the domestic portion of an investor's portfolio is typically
allocated to include a range of investment options, investors may wish
to apply that same logic to their international portfolio, selecting an
array of sub-asset classes to better position themselves for changing
international market conditions. One way to get started would be for
investors to consider global and international mutual funds.
Global funds can provide exposure to opportunities around the
world-both international and domestic. International mutual funds may
be better suited for individuals seeking purely foreign holdings to
complement their existing domestic portfolio.
Among both global and international funds, an investor may want to consider:
Market Style. Determine if you are seeking value or growth stocks or a blend of both in your international portfolio.
Market Capitalization. Select from small, mid or large "size" companies
based on the total dollar value of all its outstanding shares.
Specialty Funds. Designed for investors who wish to target their
investments either geographically or to include certain key markets,
such as real estate. Some investors may wish to consider a
fund-of-funds that includes a diversified portfolio of international
holdings. An international fund-of-funds gives investors a footing in a
variety of important international asset classes with one investment.
For example, the ING Diversified International Fund is a fund-of-funds
that incorporates a range of international market segments, including
international growth, international value, international small
capitalization stocks and emerging markets. With underlying portfolios
managed by some of the world's most respected international portfolio
managers, the fund makes it easier to build international asset
allocation into your investment plans.
As a recognized leader in global asset management, ING Funds has been
focused on providing a mix of global and international investing
opportunities for U.S. investors through mutual funds, in part because
of its access to more than 700 investment professionals located
worldwide with insight into the dynamics of markets in Europe, Asia
Pacific and the Americas.
The company's latest white paper, "Seeing the Big Picture: A Global
Approach to Investing," provides a primer on a variety of aspects of
international investing.
