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The Benefits of Geographical Diversification of Assets

Posted by Jeanne Labbé on June 9, 2016 at 12:09 PM

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In terms of capital preservation and building the strongest possible financial future for yourself and your loved ones, the old saying of "never put all of your eggs in one basket" applies in far more ways than one. For years, people have been practicing diversification in terms of securing assets in many different types of investments. While this is always a recommended first step, it is exactly that - a first step towards a much larger goal.

Diversifying your assets from a geographical perspective, meaning that your investment portfolio is spread across many different regions in the world in order to reduce risk and improve returns, is one of the best ways to generate the peace of mind that only comes with knowing you've done your part in preserving the family's future, for both current and future generations.

A Holistic Approach to Investing

One of the primary benefits of a geographical diversification of assets has to do with the way it allows you to accomplish a few different goals at the same time. Investments in different regions of the world, for example, are a great way to not only guarantee portfolio diversification but also provide a real, tangible value - unlike alternatives like the stock market. Land investments allow you to gain access to exclusive opportunities that you wouldn't have through alternative means, and also let you participate in important community-building projects and similar operations in geographically diverse locations all over the world.  

Take Advantage of Strong Economies

Another significant benefit to a geographic diversification of assets has to do with the way it allows you to mitigate risk by taking advantage of stable economies elsewhere in the world. It's no secret that the European economy is still struggling to recover from the trying economic times of the last few years. Other areas, however, have seen higher growth rates with the United States' recovery and Canada's long term economical stability. You can allocate some of your portfolio to these nations and possibly see a much higher return with a much lower level of risk.

It's About Balance

Another important benefit of geographic diversification comes by way of a much needed balance that all investors strive for. If one of your assets is located in a part of the world that is particularly vulnerable, the assets located in other areas will be able to compensate for any unexpected losses. This is particularly helpful if some of your assets are located in areas where access to certain resources are limited, or exposure to certain natural disasters is high. Without geographic diversification, you wouldn't be able to strike this balance so successfully across the board.

Topics: Geographical diversification of assets


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About Our Blog

Diversification of assets, residency and citizenship contribute in helping International High Net Worth individuals in preserving their future.

In our blog, we regularly publish information to help you understand why wealthy investors from around the world choose to diversify their assets and secure their families with citizenship and asset preservation solutions.

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