Question

Norma Rose is buying shares in a mutual fund that invests in foreign stocks sold in securities markets throughout the world, excluding the United States. What type of mutual fund is she buying

Answer 1

Norma Rose is buying shares in a mutual fund that invests in foreign stocks sold in securities markets throughout the world, excluding the United States. The mutual fund is buying are "International fund".

What are International funds?

A mutual fund that can invest in businesses anywhere in the globe, not just in the nation where its investors live, is known as an international fund.

Some characteristics of the international funds are-

• Global funds, which can invest in businesses from any country in the world, are different from international funds.
• Foreign funds and international funds are two synonyms for each other.

• Geographic portfolio diversification is the main advantage of investing in foreign mutual funds.
• Foreign market investing aids in the recovery from the current local market crisis.
• Global markets have a larger likelihood of long-term growth.
• Emerging markets, new economies, or speciality growth industries in international markets, like diamonds and tourism, are a few examples.
• Due to the booming emerging markets and as a hedge against the decline in the value of the dollar, international funds have fared well over the past 20 years.

Thus, International funds invest in non-U.S. markets, while global funds can hold both U.S. and non-U.S. companies in their portfolios.

To know more about mutual funds, here

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