Which of the following are reasons that Canadian investors should consider foreign markets when constructing global portfolios?

Question

Quizplus · Accepted Answer

Ignoring foreign markets reduces the pool of investment opportunities available to Canadian investors, which can limit their potential returns and increase their exposure to domestic risks. By diversifying globally, Canadian investors can tap into a wider range of markets, sectors, and asset classes, reducing their overall risk and potentially boosting their returns. Furthermore, foreign markets often have low correlations with Canadian markets, meaning they can provide valuable diversification benefits. Finally, returns on non-Canadian stocks can be substantially higher than returns on Canadian securities, especially in emerging markets or sectors that are underrepresented in Canada.

Which of the Following Are Reasons That Canadian Investors Should