{"id":1001,"date":"2023-08-24T06:00:17","date_gmt":"2023-08-24T10:00:17","guid":{"rendered":"https:\/\/cornerstoneportfolioresearch.com\/?p=1001"},"modified":"2023-10-25T11:53:14","modified_gmt":"2023-10-25T15:53:14","slug":"a-comprehensive-guide-to-tactical-allocation-between-domestic-and-international-stocks","status":"publish","type":"post","link":"https:\/\/cornerstoneportfolioresearch.com\/asset-allocation\/a-comprehensive-guide-to-tactical-allocation-between-domestic-and-international-stocks\/","title":{"rendered":"A Comprehensive Guide to Tactical Allocation between Domestic and International Stocks"},"content":{"rendered":"

For RIAs and IARs, navigating the complex investing world can be challenging, especially when facing where to put your clients\u2019 assets. One of the key decisions you and your clients will make is allocating the assets between domestic and international stocks.\u00a0<\/span><\/p>\n

This process, known as tactical asset allocation, forms the backbone of any active investment process. In this blog, we will explore the importance of tactical allocation between domestic and international stocks and the role of geographic diversification.<\/span><\/p>\n

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Read our newest Quick Guide, \u201cAn RIA\u2019s Definitive Guide to Tactical Asset Allocation.\u201d<\/i><\/b><\/a><\/h3>\n

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Tactical Allocation between Domestic and International Stocks<\/b><\/h2>\n

Tactical asset allocation involves actively managing an investment portfolio to capitalize on market inefficiencies and economic opportunities. It is a dynamic strategy that involves adjusting the allocation of assets in a portfolio based on short-term market outlooks.<\/span><\/p>\n

The concept of tactical allocation between domestic and international stocks centers on optimizing returns and managing risk by investing your clients\u2019 assets across different geographical markets. These markets often behave differently due to economic, political, and social variations.\u00a0<\/span><\/p>\n

For instance, when one market performs poorly, another may thrive. By tactically allocating your clients\u2019 assets, you can invest in countries and companies that are more stable with increased potential for producing premium returns.\u00a0<\/span><\/p>\n

The Role of Geographic Diversification in Tactical Asset Allocation<\/b><\/h2>\n

Geographic diversification plays a pivotal role in <\/span>tactical asset allocation<\/a><\/strong>.<\/strong> It\u2019s all about putting your eggs in multiple baskets to improve returns and minimize your clients\u2019 risk of large losses. By investing in both domestic and international stocks, you spread your risk across multiple markets and economies. This strategy can reduce risk and open the door to additional investment opportunities.\u00a0<\/span><\/p>\n

Here’s how geographic diversification can impact your clients’ portfolios:<\/span><\/p>\n