Why Invest in Globally Diversified Portfolios?
Mar 12, 2019 | 2 min. read
When it comes to investing metaphors, few are more familiar than the tried and true “don’t put all of your eggs in one basket.” But what does that really mean?
When it comes to investing metaphors, few are more familiar – or universally accepted – than the tried and true “don’t put all of your eggs in one basket.” It paints such a clear picture of the investing concept known as diversification that no further explanation is typically offered. But, with all due respect to this enduring metaphor, it does leave a number of questions unanswered. Like “how many baskets should I spread my eggs across?” And “what kinds of baskets should I use?” Or even “wouldn’t investing in an index like the S&P 500 be equivalent to spreading my assets across 500 baskets?”
In his latest position paper, First Command Chief Investment Officer John Weitzer addresses these questions while making a strong case for the benefits of globally diversified portfolios comprised of domestic and foreign stocks and bonds and “real assets” like real estate and commodities. Investing in a globally diversified portfolio is, Weitzer maintains, the best way to ensure that you will always have some of your money invested in the best performing assets at any given time and never have all of your money invested in the worst performing assets.
Please click here to download the entire white paper. If you have questions, please reach out to your Advisor. If you are not currently a First Command client, please set a time today to talk an Advisor near you.
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