I've heard that having more exposure to international markets gives you more diversification so you can offset the “risk” of your portfolio fluctuating too “rapidly.” Ok fair.
However, this seems to be more work than it's worth because one big disadvantage of foreign investing is the currency exchange risk. Foreign companies trade and pay dividends in the currency of their home country. Changes in the exchange rate between that currency and the U.S. dollar can increase or reduce your return on the foreign investment when you sell it and convert your proceeds into dollars. The U.S. dollar is strong.
Additionally, U.S. companies do a lot of bussiness globally anyway. So, why not let these U.S. companies deal with the problem of currency exchange instead of the investor?
I'm still learning as I go, but that's just my observation. What are your thoughts?
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