Award-winning real estate developer and investor Robb LaKritz is a former senior-ranking United States Treasury official and economic policymaker, and the former managing partner of the real estate investment and development company LaKritz Adler Development, LLC. He now serves as the CEO and chairman of LaKritz Holdings, LLC, a private equity fund that has diversified global investments in several sectors.
International investing is a great way of diversifying one’s portfolio, but there are several unique challenges that international investors often face. The United States is one of the best countries when it comes to regulatory and economic protections. Many countries do not offer the same shareholder rights as the United States, and investing within these countries often comes at a higher risk. International investors should take the time to learn about differing shareholder rights and regulatory guidelines in the countries they invest in. Further, reporting laws vary depending on the country. While companies in the United States report quarterly, those in other countries be only report once or twice a year. Other countries also have different reporting requirements.
Beyond challenges relating to reporting and shareholder rights, international investors have to handle varying transactions costs and currency risks. Investing in a foreign country is frequently more expensive than investing in the United States, as brokerage commissions in international markets are higher than most domestic rates. In terms of currency risk, international investors must exchange their domestic currency for foreign currency before buying stock. After selling that stock, the currency must be switched back, though the going exchange rate may not be different.
International investing is a great way of diversifying one’s portfolio, but there are several unique challenges that international investors often face. The United States is one of the best countries when it comes to regulatory and economic protections. Many countries do not offer the same shareholder rights as the United States, and investing within these countries often comes at a higher risk. International investors should take the time to learn about differing shareholder rights and regulatory guidelines in the countries they invest in. Further, reporting laws vary depending on the country. While companies in the United States report quarterly, those in other countries be only report once or twice a year. Other countries also have different reporting requirements.
Beyond challenges relating to reporting and shareholder rights, international investors have to handle varying transactions costs and currency risks. Investing in a foreign country is frequently more expensive than investing in the United States, as brokerage commissions in international markets are higher than most domestic rates. In terms of currency risk, international investors must exchange their domestic currency for foreign currency before buying stock. After selling that stock, the currency must be switched back, though the going exchange rate may not be different.