International Investing. The Dutch Investor's Perspective
Journal of Investing, Fall 1997
Posted: 18 Apr 1998
As Dutch investors add international securities to their portfolios, it becomes important to understand and evaluate both the benefits of diversification and management of the associated currency exposures. According to the analytical framework developed here, three conclusions are primary. Historical returns are poor predictors of future returns. More sensible asset allocation relates expected return to risk. And Dutch investors could benefit from more international diversification but only if most of their currency exposure is hedged away.
JEL Classification: G12, G15
Suggested Citation: Suggested Citation