2011’s Top Ten (Part 4)

My number four financial planning resolution is to think globally.

I’ve said before how it’s a global investment world. If you miss being global, you miss a lot. A good reason for this is global leadership. It’s no longer the case that the largest companies in the world are based in the US. The one of largest clothing retailers in the world is based in Spain. The world’s biggest oil company is in Brazil. So you now have to invest worldwide to be in the biggest firms.

But there’s another reason to invest globally. It used to be that the world’s economies were siloed off from each other, each operating in its own space. With global trade rising, that’s no longer the case. Now an investment in the German manufacturer Siemens is a bet on Asian manufacturing growth. An investment in Proctor and Gamble is tied to Turkish consumer appetites.

The world’s economies are tied together now to an unprecedented degree. Global trade has recovered to the level of early 2008 and is accelerating. Even troubled countries can be profitable investments. So far, the best performing markets in the world have been Spain and Portugal, in spite of their debt issues. If the world doesn’t end, they’re likely to continue to do well.

But you have to do your homework. Some global mutual funds have unconscionable fees. And some international markets still struggle with fraud. A year ago a large Indian IT firm admitted to padding its balance sheet with over a billion dollars in cash. Investors lost out when the crime was discovered.

But it would be a mistake to conclude that global markets are too risky. The real risk is missing out.

Douglas R. Tengdin, CFA
Chief Investment Officer
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By | 2014-09-11T14:34:30+00:00 January 24th, 2011|Global Market Update|0 Comments

About the Author:

Mr. Tengdin is the Chief Investment Officer at Charter Trust Company and author of “The Global Market Update”. The audio version of each post can be heard on radio stations throughout New England every weekday. Mr. Tengdin graduated from Dartmouth College, Magna Cum Laude. He received his Master of Arts from Trinity Divinity School, Magna Cum Laude and received his Chartered Financial Analyst (CFA) designation in 1992. Mr. Tengdin has been managing investment portfolios for over 30 years, working for Bank of Boston, State Street Global Advisors, Citibank – Tunisia, and Banknorth Group. Throughout his career, Mr. Tengdin has emphasized helping clients manage their financial risks in difficult environments where they can profit from investing in diverse assets in diverse settings. –
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