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International Stock Fund

What is an international stock fund?

An international stock fund is an investment vehicle holding a collection of stocks from non-U.S. countries.

  • An international stock fund is an investment vehicle holding a collection of stocks from non-U.S. countries.
  • Some international stock funds focus on developed markets (United Kingdom, Germany, or Japan), emerging markets (China, India, or Brazil), or a combination of both.
  • Many asset-allocation researchers suggest having international stocks in a diversified portfolio.

International stock funds are effective at diversifying a portfolio’s stock exposure. Some funds focus on developed markets (United Kingdom, Germany, or Japan), emerging markets (China, India, or Brazil), or a combination of both. These funds take advantage of global-opportunity stocks and diversify across many currencies.

Most researchers agree that international stock funds are core holdings in a portfolio. However, there is much debate on how much exposure investors should have in foreign equities. Skeptics argue little to no exposure, while advocates suggest up to 50% of a portfolio’s stock exposure should be international.