Hence, the volume of international investment is not reduced, and from year to year more and more rapidly. Equities world’s largest corporations listed on stock exchanges around the world. Governments and local authorities, as well as world-renowned firms and companies involved in issue of securities in other countries in the European and world markets. For a long time there is an international financial group with significant capital in those segments of the global and European investment market, where you can get a higher return on invested capital.
Investor, which deals with investment of funds outside of their state, creates an investment portfolio of options:
1. countries (currencies)? types of securities (stocks or bonds)? specific investment;
2. types of securities (stocks or bonds)? countries (currencies)? specific investment;
3. types of securities (stocks or bonds)? specific investment? countries (currencies);
4. specific investment? countries (currencies);
In the first and second cases, select the option to invest the principle of “top down” (Top-Down).
For the second and third options of investing characteristic principle of “bottom up” (Bottom-Up).
Regardless of the principle of selecting the segment of investment and facility specific investments are being pursued following general objectives:
a) achieve a higher quality of investment;
b) maximizing returns on investment;
c) minimize the possible risk of loss.
To predict the future quality of investment must be used:
• statistical information on the conjuncture of investment markets – global, regional and national;
• data on the dynamics of courses – on securities and currency;
• the views of representative experts on future situations on the stock and currency exchanges.
To reduce the possible risks and losses on investments, as appropriate:
1. be optimistic and hope for a favorable outcome in the current conjuncture of the international investment market;
2. try to diversify investments by country, asset class, industry and facility-specific investments;
3. increase the share of investment in risk-free assets (eg, short-term government bonds, etc.);
4. choose less risky assets and currency investments through the listing of securities;
5. formulate and adopt special measures of protection against adverse changes in asset prices and exchange rates.
Thus, in order to work successfully in the international investment market, it is recommended:
• thoroughly explore it in all segments;
• monitor the market conditions change the basic parameters of the investment market;
• know the characteristics and peculiarities of securities;
• reasonably develop a portfolio of foreign investments;
• effectively manage the possible investment risks;