Friday, December 31, 2010

Investment Outlook - December 2010


Our last issue for the year ending 2010.

Some highlights:
  • The bond market saw losses in November
    and has underperformed equities since
    October. There are signs of a gradual shift
    away from the bond market into equities.
    This should see the former consolidate in the
    following months.
  • There is presently a heated debate about
    whether the bond market has reached an
    inflection point and whether the multi-year
    rally we have seen has ended. There are
    some who fear that bonds are not the place to
    be at this moment.
You can download this issue here.

Take this opportunity to wish all my clients a
Happy and Prosperous New Year in 2011!!!

Investing Mindset: Gain before loss or loss before gain?

Monday, November 22, 2010

Investment Outlook - November 2010

Highlights in this November 2010 issue
  • Liquidity is the driving force behind the sharp rise in equities in recent weeks and should continue to provide a boost in the coming months.
  • While fundamentals remain important, a key characteristic of liquidity rallies is that these can take place even amid the backdrop of weak economic fundamentals.
  • At this point, we believe we are just a third into bubble territory for many markets. Nevertheless, as equity markets head higher, we will need to be cautious.
For my client, the link that is already available for you to download the report via email.

Any interested party, please furnish your detail as follows:

Subject: FA Investment Outlook - Nov 2010 (Request) 
  1. Full Name :
  2. Gender :
  3. Date of Birth : 
  4. Risk Profile : *Low / Medium / High
  5. eMail address : 
  6. Mobile :
* select appropriately

    Thank you for your interest.

    Saturday, November 13, 2010

    What are your financial objectives?

    A key to successful financial planning is to identify your personal objectives, so that you are better placed to achieve them. The following objectives are some which my clients are aspired to achieve.
    Which apply in your own case?

    • INCREASE my net spendable income
    • IMPROVE my quality of life
    • SAVE tax (including income tax, capital gains tax and inheritance tax)
    • INCREASE the return on my investments
    • SAVE money by using it effectively
    • INCREASE my expected income in retirement
    • GAIN peace of mind by feeling financially comfortable
    • REDUCE paperwork
    • IMPROVE my insight into present and future values of my pension schemes
    • INCREASE my financial security
    • REDUCE time spent worrying about my financial affairs
    • ACHIEVE financial independence
    • IMPROVE my business performance
    • SAFEGUARD my family and dependents
    • IMPROVE the organisation of my financial affairs
    • INCREASE my financial awareness
    • REDUCE personal, business and investment risks
    • INCREASE the net amounts I give to charity
    Any interesting financial objectives to share?

    Save More or Earn More

    I would like to highlight an interesting mathematical relationship on why you should considered taking calculated risk in order to achieve your financial objective. In this case, the targeted financial goal to achieve $500,000 by age 62.

    Don't forget the power of time! 37 years of accumulation which can be considered long enough to have achieved the expected rate of return of 7.68%. The expected annual saving would be just $5,596!!! ( i.e. only $466 monthly investing).

    As compared with a return of 3.68%, you are required to save more!
    How much more? $5139 (91%) more on an annual basis.

    If these options are not attainable, work towards doing a little bit of both;
    saving more money and earning a higher rate of return.

    Having a good understanding on these relationship, you probably willing to take the calculated risk, so that you can make better use of that saving on other areas of financial concern.

    Are your assets working hard for you?

    Invest in appreciating assets.
    So what are these types of assets to protect the value of money from eroding?
    • Tailor-made well-diversified portfolio
    • Stocks
    • Bonds
    • Real Estate
    • Foreign currencies
    • Gold
    • Collectibles, subject to willing buyer
    • Businesses, subject to proper management

    Having the right mix of assets investment will cushion off the impact of inflation. Money idling in the bank is likely not earn enough interest to stop its purchasing power from declining during inflation, as illustrated above.

    Therefore, selecting a portfolio that suits your financial objectives and risk profile based on your investment time horizon to grow your wealth to battle against inflation is a wise decision to make!

    The Cost of Waiting!

    There is never a right time to do your financial planning.
    However, I would encourage you not to delay it because procrastination will hinder you from becoming financially successful.

     As illustrated, if you set aside $200 per month for the next 25 years (assuming no taxes and 6.5% annual rate of return), then by starting:
    • TODAY, the outcome is $150, 579.
    • After 5 years of delay, the difference is $51,963!
    • After 10 years of delay, the difference is $89,541!!
    So simple consistent savings will lead to big payoff.
    Don't delay!
    Start now!

    Related article of interest "Systematic & Disciplined Investing that pay."

    Don't put all your eggs in one basket!

    One of the time-tested investment rules is "Diversify! Diversify! Diversify!"

    Never put all your investment eggs in just one basket.
    Different types of investments are exposed to different levels of risk and by diversifying, the losses in some investments can be offset by other investment gains.  (Refer to article here)

    The whole idea is to reduce the overall risk by investing in a broad range of economic sectors. Studies show that proper allocation accounts for more than 90% of the total return.

    How you could spread the risk...
    • Different asset classes
    • Different regions in the world
    • Different industries
    • Different companies
    • Different currencies
    • Different maturity dates, etc.

    Dependers, Spenders, Accumulators & Preservers; who are they?

    DEPENDENTS - Children are the joys in life and we are the key to their future. Helping them achieve their dreams by planning for their financial future. This is a very important and early Life Stage. It is an opportunity to provide security and peace of mind for those who are so near and dear to you and depend on you. If you have young dependants, you may want to start saving for their university education as early as possible. You may also want to be well protected should something unexpected happen to you, such as a serious illness, disability, accident or even premature death. Why? Because with adequate coverage, you can ensure that your loved ones can afford to go on living in the family home and maintain their standard of living, and that your children’s education is assured.

    SPENDERS or Savers? You may be young and single, starting out on your career or enjoying married life before children come along. Fulfill your aspirations by planning for your financial future. You may want to provide adequate protection, especially if you have just got a place of your own. With the financial commitment of a housing loan, as well as other debts, you will want to consider whether you or your family can pay off the outstanding loan should something unexpected happen. Also, this is a good life stage to begin developing skills in the areas of saving and investment. Why now? Because this is the stage in life where you begin to think about a plan to help you fulfill the goals you want to achieve as you grow financially.

    ACCUMULATORS - You have worked hard to make adequate provision for yourself and your family. Your career is advancing ... are you also advancing financially? Now you can think about saving and investing for the future — and it pays to start early. Probably, your children may have grown-up, so you can stop worrying about providing for them and start planning for improving your own lifestyle. This is the life stage where you start to think about saving and investing wisely to maximize your potential returns. You may be in a position to save and invest even more. Why? Because your financial commitments may be lessened if you have paid off your housing and car loans. Now, maybe your need for life protection will be less, although you may still want to ensure adequate protection for your health.

    PRESERVERS - You want to enjoy your retirement and health is important. In addition, you would like to leave a legacy for your loved ones. Enjoy your golden years by planning for your financial future. After a lifetime of hard work, you deserve to have a comfortable retirement. In order to maintain your standard of living during your retirement years, you may want to invest in an annuity plan or income investment portfolio which will give you a regular monthly income for life. With rising medical costs, you should also ensure your medical and long term needs are well protected. Another important need you may have at this life stage is preserving your hard earned wealth for your loved ones and arranging funding for your estate planning needs.

    At which financial stage are you? And what's your strategies?

    There are three basic financial periods that anyone could go through during their lifetime. They are the foundation, accumulation and distribution years. So it's important to have a sound financial plan to met their objectives in each period.

    In the foundation years are the young and single, the young married and the young family. Generally, they need to have sufficient funds for emergency. Most will have a regular contribution saving program or start up an investment program by dollar cost averaging approach. It's always a challenge to live within their means because lack of accumulated savings and source of income flow. Obtaining life and medical insurance is always an added advantage because of relatively cheaper premium and their good health status.

    Those who are married with kids and heading toward their retirement are in their accumulation period.The main objective is to maxmimise any savings dollars for their children education and retirement funds. To enhance their savings dollars by saving more and employ tax-saving or tax-exempted financial instruments. Proper risk management program like their life and medical insurance need to be constantly review to ensure "no shock" to their financial well-being.

    The distribution years cover the period from the beginning of retirement to the time one reached their mortality. Advanced medical can last them for a long time. Standard of living is one major concern to ensure the accumulated fund is available to maintain purchasing power of that dollar. Coming to this stage, this group of people would have some health issues, so it's better to ensure all medical insurances have already put in place, especially the medical insurance and the long term care insurance. Considering what assets to pass on to who is also another important planning goals.

    The Financial Strategy for....
    Foundation Years
    Because they have time, long enough to gain investment return to ride on the power of compounding. Next, because of time, they can afford to take risk to ride on the market and economy cycle. The strategy is to pursue a diversified investment portfolio with en emphasis on growth, and taking on riskier investments which generally yielded higher returns.

    Accumulation years
    The strategy is to continue with equity-dominated portfolio to optimize it's potential growth, while gradually shifting to income investments where equity funds are slowly replaced by bond or bond funds. It is also advantageous to maximize tax-deferred plan like SRS and tax-exempt investment instruments.

    Distribution years
    At this stage, the emphasis is to protect the accumulated assets, to reduce overall debt and to minimize tax. Since the planning horizon is short, the strategy is to shift a large portion of assets from equity to more conservative fixed-income. To balance between growth and income, annuities, bond funds and income funds could be invested. There is still the need to keep growth-type of investments as it can be used to battle against inflation.

    Friday, November 12, 2010

    DII : Loss of Integrity - Financially, Emotionally or Both?

    Whist it is appropriate to plan for retirement and premature death, it is also important to protect one’s earning capacity, whether as an employee or self-employed.

    You could lose the earning power should you become disabled as a result of injury or sickness. If that happens, you are likely incapable of paying premiums to keep your life plan in force. On top of this, your family’s current expenses need to be paid and these expenses may even increase as a result of your medical treatments or the need to employ a personal nurse to take care of yourself. In addition, you may still have outstanding loans to repay. Most of the time, such families will be financially worse off with the incapacity of the bread-winner than they would be had the bread-winner died.

    A Disability Income Insurance (DII) would be a useful insurance protection, income protection, to help safeguard a person’s earning capacity in the above situation.

    DII is also known as Income Replacement Insurance. It is designed to help you to maintain you and your family’s standard of living. It provides a regular monthly income to cover your expenses in the event of a disability due to illness or accident. [Refer table below to understand between DII & Total Permanent Disablement (TPD)]

    Can be issued on a stand-alone basis or as a rider
    Usually incorporated into life policies. Can also be issued as a rider
    Max sum assured is a %age of the monthly salary
    Sum assured not pegged to salary
    Escalation benefit available
    No escalation benefit
    Partial disability benefit available
    Partial disability benefit not available
    Choice of deferred period
    No deferred period (only proof of TPD)
    For working adults only
    Available to both people who are working and not working
    Provides income replacement
    Accelerates the death benefit payable under a life policy
    Benefit payable on a monthly basis
    Benefit could payable in installments
    If you were sick or hurt tomorrow and wouldn’t go to work… 
    how long could you live on your savings? .

    There was an adviser, call “John”. He has a strong conviction and work very hard as a life insurance adviser with an insurance company. As usual, he did a complete life insurance programming for this particular client. “Mr. Tan” was impressed with his conviction and his presentation on what life insurance can do for him. After policy delivery, he thought to himself, another job well done; another family well protected.

    After 2 years, Mr. Tan was diagnosed with an unusual disease which affects his nervous system. He was hospitalized for medical examinations and unable to go to work for a long period of time. They could not find any cure for this unusual disease. As the medical bill was escalating, the family decided to bring him home and take turns to nurse him.

    John went to paid him a visit. There, the property agent was there to discuss the selling of their home. The wife was completely distraught and crying. His son who was in his 2nd year of undergraduate studies decided to quit the faculty and to take a job that he could help out with the household expenses.

    John saw Mr. Tan lying on his bed… destitute, penniless, helpless. John was wondering: “What do you say to a man like this?” “How do you comfort him?” John mumbled a few vague words and left as quickly as possible. With a heavy heart, he left for his office and work out his “balance sheet” for Mr. Tan, as follows:

    • Here is the man who bought life insurance for last expenses; but didn’t die.
    • He bought life insurance for guaranteed income to his widow; but he doesn’t have a widow; he has a wife.
    • He bought life insurance for the savings which could be had; but they are long since gone and his new policy has not accumulated any.
    • He bought life insurance to guarantee the mortgage on his home; but he lost his home anyway.
    • He bought life insurance to insure the college education of his son; but his son didn’t even finish his university.
    • He bought life insurance to guarantee a pleasant retirement; he won’t live that long.

    John has helped his clients to understand what life insurance can do, but life insurance has its limitations. Though Mr. Tan has medical coverage, it does not cover all expenses.
    [1] So what measures could he have taken to protect the value of his earning power? 
    [2] How much money will he need in such a situation? 
    [3] Where is the money going to come from?

    Let’s do the sum. 
    Assuming “Joe” is 35 and currently earning $5000 per month. Between now and his age of 65, he stands to earn [(65-35) x $5,000 x 12] $1,800,000 and could have accumulated assets (house, car, CPF, Savings, etc) which going to worth about $1,000,000. Assuming the annual premium for DII is estimated $2,000, this premium is about 0.2% of his potential growing net worth. So does it make sense to insured his income potential?

    Our most valuable asset is our ability to get up in the morning to earn a living. It is this earning power that is one asset that allows us to have the others. So how about setting aside about 1% of your income take care of the other 99%?

    Thursday, November 11, 2010

    7 types of Health Insurance

    Basic Medical Insurance  or commonly known as Hospital & Surgical Insurance (H&S), is a reimbursement medical plan that provides benefits for covered medical costs that result from accidents and sicknesses. Reimbursed for inpatient expenses incurred during hospitalization as well as certain outpatient expenses subject to the limits stated in the policy. In other words, the client may not get a full reimbursement for the medical expenses incurred. 2 common types of limits – Separate limits, a.k.a. sub-limits for each of the covered expenses. Next, it’s the maximum limit on a per disability basis for the inpatient benefits and a flat dollar amount for the outpatient benefits.

    Some insurers may practice “expense participation method” on the policy, which means to say that you need to bear part of the medical costs.

    Deductible is usually a flat dollar amount of medical expenses, such as $500 or $2,500 that the patient must fork out of his pocket. I call it the “first-dollar ownership”. It is usually on a per year basis.
    The “second-dollar” payment is the co-insurance whereby the patient need to pay a specified percentage, e.g. 15%, of the total covered medical costs which are in excess of the deductible.

    Major Medical Insurance or Catastrophic Medical Insurance is designed to cover the cost of major illnesses where the medical cost can be substantial. Besides covering for inpatient and outpatient benefits, it also provides cover for certain expensive treatment like kidneys dialysis and cancer treatment.  Together with the basic Hospital & Surgical policy, some insurers name it as comprehensive major medical expense insurance policy. Such plan usually has deductible and co-insurance element, as mentioned above. The national MediShield is one good example.

    Supplemental Medical Expense Insurance is a separate range of optional covers to the main Medical Expense Insurance policy which some insurance companies offer. These are meant to enhance the cover under the main medical plan and include:
    ·      Emergency assistance services;
    ·      Dental cover;
    ·      Maternity benefit;
    ·      Organ transplant
    ·      Specific disease insurance;
    ·      Surgical implant and prosthesis;
    ·      Miscarriage benefit;
    ·      Private nursing home care;
    ·      Death Benefit, etc.

    Key Features of Medical Expenses Insurance
    • Stand-alone or Rider
    • Choice of Plans
    • Family Coverage, usually come with a discount
    • Reimbursement of expenses
    • Deductible & Co-insurance
    • Plan Limits – Lifetime limit, Annual limit, Event limit.
    • Coverage charges, e.g. Room Charges, surgery, doctor’s consultation, etc.
    • Geographical limit – Usually auto terminate if you are out of Singapore for more than 180 days.
    • Waiting Period
    • Age Limit
    • Premiums is based on age-band
    • Guaranteed Renewability
    • Exclusions & Limitations
    • Co-Ordination of Benefits Clause – To ensure that the insured will not get more than he has actually incurred.

    Disability Income Insurance helps to replace a portion of your income should you becomes totally or partially disabled and unable to work as a result of an accident or sickness. It is an income protection plan.

    Disability Income Insurance (DII) is not Total Permanent Disability (TPD) Benefit. Briefly, DII provides an income replacement if you are unable to work whereas TPD serves to accelerate the death benefit payable under a life policy.

    Long Term Care Insurance pays a monthly fixed amount for long term nursing treatment, based on ADL requirement. Benefits are paid when you cannot perform some “activities of daily living” (ADL). These include bathing, dressing, feeding, going to the toilet and moving around. The national ElderShield offers the long term care benefit.

    Critical Illness Insurance, commonly known as Dread Disease plan, provides a lump sum benefit to an insured in the event that he is diagnosed to be suffering from one of the critical illnesses or is undergoing a surgical procedure covered under the policy. (Please refer to http// for the CI definition.)

    Hospital Cash Insurance is a daily cash benefit paid directly to the insured if he is hospitalized as a result of accident or illness. The daily benefit is a fixed dollar amount selected by the insured at the inception of the policy, and is usually limited to a specified number of days per hospitalization.

    Seek Professional Advise. As there are different types of medical plans available, it could be confusing what is suitable for your situation. So it is always advisable to seek professional help, someone who could analyse your medical needs and has your best interest. Such a professional would be an independent financial planner. For instance, you wouldn’t want to be caught in a situation where you are over-insured and is limit by the “co-ordination of benefit”.

    Being “independent” is not constraint to marketing a specified product or forcing you to buy “house-brand”. Instead, you could compare various benefits from different insurer where the independent financial planner could present his comparison that best suited for your needs, and most importantly within your budget requirement.

    In this way, you could secure the appropriate and suitable medical coverage for yourself and set a good peace of mind for your love ones.

    At your "financial" service....

    Setting up your business?

    What business, other that the financial services industry, offers you the opportunity to:
    • Go into business of your own with $1,000 of capital?
    • Have only your clients as your boss?
    • Be paid exactly in proportion to your ability and results?
    • Have unlimited as to the amount of money you can earn?
    • Be allowed to tailor-make your own working hours?
    • Work without fear of having your quota raised or your territory or commission scale diminished?
    • Work without having your success pattern depend upon your ability to "butter up" the owner or the people at company headquarters?
    • Be in a position where there is no jealousy or bitter rivalry between yourself and your producers; where your success cannot in any way impair your producer's progress, or vice versa?
    • Be in a business that becomes easier and less demanding as you grow older, compared to the mounting pressures encountered in most business?
    Look no further, there is none other than the Financial Services Industry! 

    Chew Hock Beng B.Eng, CLU, ChFC, CFPCM, RFC®, CBC, ACBC, LUTCf, FSS, Dip.SCI(Life), Dip.SCI(General), MDRT 2005, 2006, 2007, ANZIFF(Assoc) CIP, ASII, FIFP(S'pore) 
    @ +65 9389 7195 or send your resume here!

    Tuesday, November 9, 2010

    Be S.M.A.R.T. in setting your financial goals

    It is not good enough to know what your financial goals are.

    Financial goals need to be "S.M.A.R.T."!

    Set it by clearly defined what you really want to achieve it by being Specific.
    It is wise to convert all your financial goals to "dollar and cents" for it to be tangible and Measurable so that you aware of how much you can work on it. Of course, the goals you set need to be Achievable within your financial means and desires. More often than not, we tend to set high goals for ourselves. However, I feel it's always good to set a Realistic goal; something you are capable of achieving it, something that you will be going to be proud of. A goal without having a Time frame is like living without urgency. How much time you need to arrive your financial destination will determine the quality of lifestlye you get to enjoy your fruits of labour.

    To make sure you arrived your financial destination safely, placing appropriate yardstick along your financial journey is great importance to ensure that you are always on track.

    With proper goal setting, you can achieve your goal SMARTly!

    Saturday, November 6, 2010

    Which come first? Making profit or making loss?

    To have profit, first you need to make a loss!

    It may sound bizarre but the first step to making a profit in the stock market is to make a loss. Not a real loss, but what’s called a paper-loss. This means that you must expect any investment you make to go down over the short-medium period, but in the long term it will generate a profit. All this is not just some fancy theory, but something based on a hardcore study of numbers and investor psychology.

    You may do a great amount of research work and put in hours to come up with an investment strategy and the investment-based financial planner whom you engaged may offer you investment advice, while this is good discipline, it by no means guarantee success. Making sustainable profits from investment depends on endless factors, some predictable and others totally unforeseen. So, how do you ensure a good investment growth over long-term?

    When you make an investment, you should be prepared not to expect any positive returns for the short to medium term. In such a case of uncertainty, expectation is what is considered the most likely to happen. Expectation is a belief centered to the future and it might or might not happened. More often than not, investors tend to feel disappointed when they do not expect the unexpected. So expecting loss before gain will go a long way. Only beyond that, the returns will start to roll in. According to Newton’s law of gravity, what goes up must come down, what goes down must come up, except for one’s age. Expecting loss or "Loss expectation" is an important psychological step to cross a bear market, when things are less rosy and negative markets overrule.

    Bull markets can sometimes send you the wrong signals and lead you to think that the markets will never disappoint you. And, often investors get into without asking the right questions hoping to make quick profits. Then psychological expectations grow out of proportion and greed gets the better of them. Investors would end up holding the investment assets against unnecessary risks. And when the markets crashes without warning, it may be too late to exit (The Lehman Brothers) without getting burnt. One way is to adopt the “ERP” approach when various investment opportunities are evaluated. As an intelligent and informed investor you should not only be motivated by (P)erformances, but also be aware of taking calculated (R)isks and the cost of maintaining the investment or the (E)xpenses incurred. Buying into an overly bullish market is clearly not based on taking calculated risks.

    On the other hand, when the market is more bearish, you could be able to identify the potential value in the capital market. Due to the less optimistic investing environment, you need to adopt a more practical return growth path and accept a realistic practical return growth path. Your main focus is on the recovery and how you can ride on it. What we want is the return and not to be stuck with those fund that is not performing. Hence, the most important strategy is to buy only fundamentally sound diversified investments across asset classes, geographical regions and funds of reputable fund managers with strong investment ratings.

    Getting over a negative state of mind through loss expectation is very important in a bear market. You should hold on to fundamentally strong investment assets on a long term basis and be prepared to take in the “paper loss” arising in the short term and mid term.

    Always remember, successful investors are in control of their emotions and are more likely to act on facts as opposed to feelings. Patience and perseverance are two essential traits during a bearish market. If you are able to handle losses emotionally and come out of it, you would have more flexibility and adaptability to handle future uncertainty better. Even the best investment selection system would lose money if you do not have the right attitude, so develop a positive one. Always have a long term view, this is a sound investment strategy and has been proven to be successful towards building and preserving your core wealth.

    So be prepared and expect for small loss to gain BIG profit!

    Related articles: Adjusting our mindset to avoid common behavioural pitfalls.

    Tuesday, October 26, 2010

    How to handle risk?

    The risk of doing nothing
    Almost everything we do carries risk, unfortunately. Saving your money in a bank deposit account leaves it exposed to inflation risk. The long term rate of inflation in Singapore is around 2.8%. Therefore money on your bank account receiving no interest will lose approximately that much of its purchasing power each year.

    However, there are many different types of investment available, some with greater risk than others, An investor’s financial goals and risk appetite will dictate what type of investment best suits them but, generally speaking, there should be a suitable investment solution out there for everyone.

    Interest rate risk
    Have you ever wondered why interest rate moves are so keenly watched by the financial community? They have an immediate impact on mortgages and saving accounts and are vital to the price of equities and bonds. When interest rates rise, cash investments become relatively more attractive than equities and bonds; this may cause their price to drop, and vice versa.

    The effects of an interest rate rise or fall can be lessened by investing across a range of different asset classes i.e. holding investments across equities, bonds and the money markets.

    Sector investing
    Over certain periods of time, one or more market sectors will tend to outperform the overall market. While it might be tempting to invest purely in such sectors, if their fortunes change for the worse, the value of a portfolio would fall with them.

    Investing in funds that offer exposure to different international markets can be a further way of spreading risk. This will increase exposure to good opportunities but help to lessen the risks associated with investing in one country’s stock market.

    Market risk
    This is the risk of investing in the stock market. For example, an unexpected event such as a terrorist attack or an economic or political event could cause values to fall. This type of volatility is hard-to-predict volatility and often leads to investor panic.

    Taking a long term investing strategy is one way to combat this type of risk. Historically the equity markets have appreciated. Therefore by staying invested for five to ten years, investors have a greater chance of riding out short term ups and downs. (Volatility)

    International exposure
    Just as market sectors within one country will not always perform in the same way, stock markets across the world behave differently to each other. There may be times when for example, European markets will be stronger than those in the UK, or emerging markets, such as those in Asia, will perform better than large established ones, such as in the US.

    Investing in funds that offer exposure to different international markets can be a further way of spreading risk. This will increase exposure to good opportunities but help to lessen the risks associated with investing in one country’s stock market.