Global Equity Investing: The Benefits of Diversification and Sizing Your Allocation

Overview

Investors can diversify their portfolios through equity allocations to markets outside their home market. Despite this opportunity, investors on average have maintained allocations to their home country that have been significantly larger than the country's market-capitalization weight in a globally diversified equity index. This paper explores the potential benefits, and the factors to assess in determining portfolio allocations.

Advisor Thinking