I am planning to add some international funds to my portfolio. Can you suggest some funds covering Japan, Brazil, China and European markets? The issue is that most of the international funds in India are US based.
- Mohammad Iqbal
There are a lot of funds. Some funds are specific to a particular region, some funds invest in a particular theme and some funds invest all across. But when compared with US-based funds, these funds have a relatively disappointing long-term performance. US-based funds look more promising.
Don't consider US-based funds as investing in US companies only. The US companies in which most of the US funds invest have global businesses. When you buy Apple, Facebook or Microsoft, you are not buying a US company, you are buying a company that has business spread all over the world. These are quality businesses, promising and are fast-growing.
Also, when you invest in US-based funds, you will benefit from the rupee depreciation. That is an additional gain. And that is likely to continue till the time there is a differential between the interest rates of both the countries.
So, keeping that in mind, I would say it is good to invest in US funds as they invest in companies that have global businesses. You just don't need diversification but you also need performance.