The Investing for Beginners Podcast - Your Path to Financial Freedom International Investing 101: ADRs, Foreign Markets, and Building Global Wealth
May 12, 2025
Brett Schaefer from the Chit Chat Stocks podcast shares insights on international investing and the advantages of portfolio diversification. He emphasizes starting with a 10% allocation in familiar markets, like Mexico and Europe, while avoiding unstable regions. The conversation covers the power of American Depository Receipts (ADRs) for accessing foreign stocks and highlights the complex differences between IFRS and US GAAP accounting standards. Schaefer also discusses the impact of currency fluctuations and the accessibility of international brokerages for beginner investors.
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Start Small in Familiar Countries
- Diversify internationally with about 10% of your portfolio to start.
- Focus on countries you understand culturally and economically to reduce risk.
Brett's International Portfolio
- Brett Schafer invests in Mexico, South Korea, and Japan due to cultural familiarity and economic ties.
- He holds stocks like Alsea (franchise operator) and Nintendo reflecting his comfort zone.
Avoid Unstable Markets
- Avoid investing in regions with political instability and weak rule of law like Africa or China.
- Prioritize markets with stable judicial systems and predictable regulations for safer investments.