Country diversification

Country diversification

Investment of a global or international portfolio's assets in securities of various countries.

Country Diversification

Investment of one's portfolio in securities that are traded in various countries. This is done to reduce risk, often political risk. For example, if one country's government announces a larger than normal budget deficit, or the central bank raises interest rates, this may affect security prices in one country but not necessarily in other countries that did not take equivalent steps. Likewise, if a whole industry fails in one country but thrives in another, investing in the same industry in both countries hedges one's risk. Some analysts argue that country diversification is less effective in an era of globalization, but other analysts dispute that.
References in periodicals archive ?
Inspite of this, a good manager can mitigate these risks through country diversification and / or shorting selected correlated mainstream emerging markets.
In contrast to a traditional emerging markets equities-only portfolio, the Total Emerging Markets strategy is designed to encompass an expanded investment universe and should benefit from a greater degree of country diversification than an equities-only portfolio as the equity and fixed income universes in emerging markets only partially overlap.
We should make both product and country diversification.
EPADI offers investors a well balanced exposure to the petrochemical and energy related companies listed across the region with adequate cross country diversification that is targeted towards risk optimization.
It seeks to reduce concentration in legacy frontier market industries, broaden country diversification and tap into available liquidity to gain exposure to potentially emerging industries.
International diversification: While country diversification offers only limited protection in the current highly-correlated world equity markets, it offers hedging opportunities from local economic weakness and associated currency exchange differentials.
International diversification - While country diversification offers only limited protection in the current highly-correlated world equity markets, it offers hedging opportunities from local economic weakness and associated currency exchange differentials.
International diversification: While country diversification offers only limited protection in the current highly-correlated world equity markets, it offers hedging capabilities from local economic weakness and associated currency exchange differentials.
International Diversification - While country diversification offers only limited protection in the current highly-correlated world equity markets, it offers hedging capabilities from local economic weakness and associated currency exchange differentials.
Regional and country diversification will likely increase in the coming years as well, as Brazilian producers seek to lower sanitation risks and take advantage of low cost structures in Paraguay and lower export restrictions to Uruguay.