How to Find Value Investments Offshore

How to Find Value
Investments Offshore
By www.ProfitableInvestingTips.com

http://profitableinvestingtips.com/profitable-investing-tips/how-to-find-value-investments-offshore
As the bull market in stocks
ages, US investors are rolling
over their investments from
a focus on growth to a
focus on value.

They are also looking offshore
for foreign investment
opportunities.

Some choose to combine the
two approaches, but how do
you find value investments
offshore?

CNBC reports that Morgan
Stanley is looking offshore for
value and where to put your
money for the next year and
they specifically suggest Brazil,
Thailand, Indonesia, India,
Peru, and Poland.

Underpinning the bank’s
preference for stocks in
emerging markets is an
expected stabilization in
growth in those economies in
2019, while expansion in the
U.S. is expected to slow.

The projected turnaround for
emerging markets is one
reason why the investment
bank prefers stocks in those
economies over that of the
U.S. next year.

Morgan Stanley said it
upgraded emerging market
stocks from “underweight” to
“overweight” for 2019, while
U.S. equities were downgraded
to “underweight.”

So, if you too think that the US
bull market has largely run its
course and that the emerging
market bear market has
likewise stopped going
down, why aren’t you
investing offshore?

How to Find Value
Investments
Offshore: American
Depositary Receipts

Unless you have specific
knowledge and experience in
foreign markets and with
foreign investments, you may
not know where to start.

And, for that matter, you may
not have the time to evaluate
specific investments in specific
countries.

You can follow the advice of
folks like Morgan Stanley, but
what stocks to you look for in
Brazil, Thailand, Indonesia,
India, Peru, and Poland?

Once you have decided that a
certain country is socially,
politically, and economically
stable, how do you pick stocks
or other investments?

One useful approach is to look
at American Depositary
Receipts or ADRs from any of
these
nations. Investopedia defines
ADR.

An American depositary receipt
(ADR) is a negotiable
certificate issued by a U.S.
bank representing a specified
number of shares (or one
share) in a foreign stock
traded on a U.S. exchange.

ADR holders do not have to
transact in foreign currencies,
because ADRs trade in U.S.
dollars and clear through U.S.
settlement systems.

The U.S. banks require that
the foreign companies provide
them with detailed financial
information

making it easier for investors
to assess the company’s
financial health compared to a
foreign company that only
transacts on international
exchanges.

Because ADRs come with
financial reports similar to
those for US stocks, it is
possible to make an intelligent
decision regarding the financial
strength of the company.

As such this is logical way to
find value investments
offshore.

How to Find Value
Investments
Offshore:
International Stock
ETFs

Exchange traded funds or ETFs
that include foreign stocks are
also a viable route to take if
you do not have a specific
stock or country in mind.

And when you do not have the
time or expertise to find and
evaluate specific investment
opportunities you can look at
ETFs that fit your needs.

US News offers International
Stock ETF rankings.

U.S. News has identified
exchange-traded funds best
suited for long-term investors
seeking low-cost, diversified
portfolios.

Our rankings compare the cost
and structure of hundreds of
ETFs using
our comprehensive
methodology.

They group the international
ETFs as follows:

China Region
Diversified Emerging Markets
Diversified Pacific/Asia
Europe Stock
Foreign Large Blend
Foreign Large Growth
Foreign Large Value
Foreign Small/Mid Blend

Foreign Small/Mid Value
Global Real Estate
India Equity
Japan Stock
Latin America Stock
Miscellaneous Region
Pacific/Asia ex-Japan Stock
World Large Stock
World Small/Mid Stock

Each of the groupings has two
or three options.

You can look at
their methodology to see
how they make their picks.

Since all ETFs are intended to
track an underlying index (for
a variety of equities, or the
price of a commodity, for
example)

we aim to identify large, liquid
funds that perform reliably and
could function well as part of
an investor’s long-term asset
allocation plan.

We also compare funds’ costs,
both those contained in
commonly published expense
ratios and implied by trading
spreads, as well as a fund’s
level of diversification and
success in tracking its index.

In this case you are not so
interested in evaluating
specific stocks

as you are in knowing how
well the fund is run, how well
it tracks its basket of equities,
and how well they control
costs so that profits are
passed on to you and not
sucked up by the fund’s
management.

This is a reasonable approach
to finding value investments
offshore.

How to Find Value
Investments
Offshore: Country
Risk and other Issues

Although one can find
spectacular profits in foreign
investments

one can also invest offshore
and lose everything when the
government confiscates
private assets, descends into
civil strife, or otherwise
damages your investment.

How to evaluate a country
for investment starts as
simply as looking it up on
Google Maps!

The World Bank is an excellent
source of information for
investing offshore.

Whether you are thinking
about foreign direct
investment or buying ADRs,
the World Bank has lots of
great information to help you
evaluate a country for
investments.

The World Bank business
project lookes at the ease of
doing business index.

This is a ranking from one to
189 of all nations for how easy
or how hard it is to do
business there listed by
several factors.

If you go to the World Bank
links make sure to navigate to
the most recent reports.

Another useful source of
general information about any
given country is the CIA
Factbook.

This source will not give you
specific information for specific
investments but it will give you
a good sense of the country,
its economy, and the safety or
risk of investing there.

How to Find Value
Investments
Offshore: Short or
Long Term?

A few years ago everyone
wanted to invest in Brazil.

The markets collapsed for
commodities and Brazil’s
economy went with it.

Both in the USA and offshore
there are investments that
look great and then they don’t.

We wrote some time back
about the resource curse of
boom and bust cycles.

If you believe that you can
time the markets, some of
these investments can be very
profitable.

But, if you simply want
offshore investments that will
grow over time and allow you
to sleep at night, look for
stocks and ETFs with long and
stable track records.

How to Find Value Investments Offshore

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