Canto 7

International investing

No matter where you live, the capital markets in your country account for less than half of the world's total. The US has the largest share of the world's stocks and bonds, and it's just over a third. Most people believe that it's important to have some of your investments in countries other than your own, just in case your country's economy doesn't do very well and other countries do better. I think that's true, and it's probably more true for people who live in countries with smaller markets.

How big are the markets in different parts of the world?

Here are some examples of what percentage of the world's stocks and bonds are in different parts of the world:

Principles you might want to consider

How to invest internationally

I think it is pretty difficult to invest in individual stocks traded on the exchanges of other countries, with a few exceptions. I think a Canadian can buy US stocks through a Canadian brokerage, for example. In general, though, I think it's a lot easier to do your international investing using mutual funds or ETFs.


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