International investing isn’t a new concept, but it is one that is picking up speed as an increasing number of people decide to move their assets overseas. International investors have a unique opportunity ahead of them, but the sheer number of investors and locations available can make it overwhelming.
If you’re new to the world of international investing, then let these five tips guide you as you begin the exciting financial journey ahead.
1. Define Your Objectives
One of the most important things that every international investor needs to do is define their financial objectives. No two investors will have the same goals, but it is these goals that will determine the best types of investments you make.
If you ultimate goal is to protect and preserve assets for loved ones in the future, then stable investments with an emphasis on diversification might be best. If you are younger, or you want to take bigger risks and see larger profits, then it might make sense to choose investments in developing countries or related to venture capitalism, where there are both greater risks and greater rewards.
2. Diversify Your Investments
Most people who are ready to begin international investing already acknowledge the need for financial diversification. However, many people forget that diversity is about more than just geography. While holding investments in multiple markets is certainly a great start, that isn’t the only way to mitigate risk.
International investors should also consider the diversification of their holdings by industry and type, ensuring that the risk of vulnerability is spread as much as possible.
3. Choose Jurisdictions Wisely
It is also important for new international investors to pay special attention to the locations where they decide to invest. No two countries will have the same specifications, and some jurisdictions certainly have an advantage over others.
When it comes to taxation, for example, some countries like Belize will waive the income and capital gains taxes for all foreign investors. Saving such a tremendous amount each year by not paying taxes, and keeping the entire thing legal and above board, can certainly make one country more appealing than another.
4. Maintain Assets in a Bank You Can Trust
New international investors should have an offshore bank where they can store assets and maintain capital for future investors. While there are a wide range of banks to choose from, some stand out from the pack.
Things that are integral to a successful offshore bank include high reserve requirements for the financial stability of the institution, online banking services for 24/7 updates around the world and great communication from staff, preferably from those who speak English or another foreign language fluently for the convenience of account holders.
5. Protect Your Privacy
If you’re used to investing domestically, you might not realize that international investing offers new layers of privacy. You can protect your anonymity when starting trusts or businesses, if desired. Enlist a financial expert to help you keep your identity private as you begin investing on an international scale.
With these five helpful tips in mind, new international investors can take full advantage of the many excellent financial opportunities found around the world.