Dominic Browning, Managing Director
Posted by Dom Browning
05/01/24
News, Resources, Insight and Opinion from Browning Financial Planning

Where to invest in global equities?

Dominic Browning, Managing Director
Posted by Dom Browning
05/01/24

There is a big world out there, with lots of investment opportunities. We thought we would share a few facts with you.

Clients sometimes ask me why we tend to invest largely in developed markets when there can be some exciting investment opportunities in emerging markets.

When you invest in global shares, you are not investing in economies, land masses or populations, you are investing in companies and 88% (£50 trillion) of the World's companies are considered to be developed markets. 12% (£7 trillion)are considered to be emerging markets.

Emerging markets come with extra risks such as political risk. We think it is best to minimise exposure to emerging markets and just invest in the remaining 88% of the World stock-markets.

We are also asked why we heavily invest in the USA. The US stock-market makes up 60% of the total market by market capitalisation. Most of the great companies of the World are based there. Apple on its own makes up 3% of World equity market capitalisation. This is larger than most countries. The whole of the Chinese stock-market makes up only 4%. So we invest where we consider the best, risk-adjusted opportunities are.

Another question we get is why we do not invest more heavily in the UK. Well, the UK makes up only 4% as well ( it used to be 11%). There is a name for having too much invested in your own country. It is called home bias and should be avoided (unless you are American!). So why restrict yourself to only 4% of the investment opportunities out there, when the World is your oyster?

More News, Insight & Opinion
Will you outlive your retirement pot?

The most important question to be asked is ‘How long will you live?’  Continue

HMRC repaid record £198m on flexible pension withdrawals

A record £198m was repaid on flexible pension withdrawals for the tax year 2023/24, latest HMRC data shows. Continue

Lifetime ISAs - Why basic-rate tax-payers under 40 should consider them.

Lifetime ISAs were created to help people under 40 save for a house deposit. But are they any good as long-term savings if you do NOT buy a house? Continue

Life Boat Drills

If you have ever been on a cruise, you will be aware that the crew will carry out lifeboat drills either in harbour or shortly after leaving.  Continue

Why our fees are competitive

I was recently shown the pricelist of St James's Place, a FTSE100 financial advice firm. I nearly fell off my chair. Continue

Company Pension planning options

We regularly look at the company pension funds of prospective and existing clients. Continue