Unlock Better Returns, Look Beyond Your Home!
Do you love supporting local businesses and shopping close to home? It’s great to keep things local, but sometimes, you need to look further to find what you need.
In the world of investing, this idea is crucial. Many people tend to invest heavily in local shares, a habit known as “home bias.” But with the market constantly changing, both in Australia and globally, it’s important to diversify your investments.
What is Home Bias?
Home bias happens when investors prefer domestic shares over international ones. In Australia, our market makes up just 2% of the global market. So, if a large part of your portfolio is in local shares, you’re missing out on opportunities elsewhere and taking on more risk.
Why It Matters
If the Australian market doesn’t perform well, your returns could suffer, affecting your long-term goals. Plus, focusing too much on local shares can mean you’re overexposed to certain sectors, like mining and banks, which dominate our market.
The Benefits of Diversification
By investing more globally, you can tap into opportunities in other regions and sectors not available in Australia. This approach helps spread risk and can lead to better returns.
How We Can Help
If we manage your investments, rest assured that we consider these risks. We often allocate more to international shares to protect your portfolio from local market ups and downs. Right now, we have a strong focus on international shares to guard against any potential underperformance in the Australian market.
If you have any questions or want to discuss your financial plan, just contact us with “checkin”. If we don’t manage your investments yet, contact us “international” and we’ll guide you on the next steps.
Not sure where to start with your money? Join our Quick Fire one-on-one Q&A session for 10 minutes of rapid, valuable insights and immediate answers to your financial questions. This is your chance to get quick, actionable general advice on the spot for free (limited spots available). Please book this online session here.
We hope you enjoyed reading this blog post and found it useful. If you have any questions, comments, or feedback, we would love to hear from you.
7Wealth Pty Ltd ABN 44609210246 is a Corporate Authorised Representatives and is authorised through Cobalt Advisers Pty Ltd ABN 64 628 654 099 who is an Australian Financial Services Licensee 512550. 7Wealth Pty Ltd is a Credit Representative of Australian Finance Group Ltd ABN 11 066 385 822 (AFG) Australian Credit Licence 389087.
This blog contains information that is general in nature. It does not constitute financial or taxation advice. The information does not take into account your objectives, needs and circumstances. We recommend that you obtain investment and taxation advice specific to your investment objectives, financial situation and particular needs before making any investment decision or acting on any of the information contained in this document. Subject to law, Cobalt Advisers Pty Ltd nor their directors, employees or authorised representatives, do not give any representation or warranty as to the reliability, accuracy or completeness of the information; or accepts any responsibility for any person acting, or refraining from acting, on the basis of the information contained in this document.
