Learn The Benefits and Advantages of Global Diversification | Mission Wealth

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Osborne Chief investment officer at Mission wild and today I’ll be discussing the importance of global diversification so what is global diversification and why is it important Global diversification refers to a portfolio allocation to equities across the globe including allocations to International and emerging market stocks in addition to the U.S stock market so why do we believe Global diversification was important well as measured by global market capitalization nearly half the global stock market opportunities exist outside of the US as such we think it’s important to have dedicated allocations to both International and emerging market stocks across our model portfolios longer term economic growth rates are also expected to be higher in many countries outside of the US particularly for emerging market countries such outsized growth rates may in turn benefit stock market returns in those same countries We Believe having dedicated allocations to higher growth economies May thus provide for increased longer term expected portfolio returns maintaining a globally Diversified stock allocation may also provide

diversification benefits within a well-constructed portfolio U.S International and emerging market stocks don’t always move in tandem in many instances U.S stocks may be up while International or Emerging Markets move down or conversely U.S stocks may experience weakness while International or and or Emerging Markets outperform a prime example of the benefits of global diversification is the time period commonly referred to as the Lost decade for U.S stocks from January 2000 through December 2009 the S P 500 lost nearly one percent on an annual return basis have you had all your stock investments in the US you would have lost nearly one percent annually over the 10-year period however how do you maintain dedicated allocations to International and emerging markets in a globally Diversified portfolio both International and emerging market stocks would have helped offset the negative U.S stock market return that’s because in contrast to the U.S market International stocks were positive over that same decade returning an annualized three and a half percent return while emerging markets were soundly positive returning 10.7

annually over the same time period this Divergence and returns across asset classes may also offer enhanced rebalancing opportunities and may add to the overall long-term return potential of an Investment Portfolio over the Long Haul We Believe maintaining dedicated allocations to International and Emerging Markets may help provide diversification benefits and enhanced rebalancing opportunities while concurrently offering upside growth potential and may ultimately provide for increased longer term expected portfolio returns I’m Karen Osborne Chief investment officer at Mission wealth in this video discussed the importance of global diversification for more information please visit missionwealth.com or contact your client advisor foreign [Music]