More returns and less risks? Think global

More returns and less risks? Think global

Can you spot Australia in the image below?



On the world stage, Australia’s stock market is a very small player (see bottom right corner). If you’re only invested in Australian shares, check out the world of opportunities you are missing out on!

Here are 3 emerging trends taking place on the world stage:

  1. The Indian stock market has grown by $1 trillion in under three years, making the country one of the best performing emerging markets.
  2. The stock markets in China and Hong Kong have lost around $6 trillion in valuation since their 2021 peak. The Hang Seng Index has shrunk by more than 40% over the past five years.
  3. The Magnificent Seven (the largest 7 tech companies in the US) continue to dominate and account for roughly a quarter of the overall U.S. stock market.

A portfolio of only Australian shares can be too concentrated and risky as our home market is dominated by the banking and mining sectors.

A better approach is to strategically diversify your investments into global markets to embrace more opportunities while reducing risks at the same time.