Four Fine All-in-One Foreign-Stock Funds
These funds provide exceptionally broad international exposure in one package.
The universe of open-end international-stock funds contains a growing number of really specialized offerings. Indeed, though the Brazilian, Chinese, and Indian markets have been beset by worries about slowing growth, rising inflation, and other issues in 2011--and posted disappointing results--one Brazil fund, four China-region offerings, and five India funds have opened since Jan. 1.
Such launches are part of a trend. Many other Brazil, China, and India funds have opened in recent years, along with some offerings that focus on other developing markets such as Korea or Russia and several regional small-cap funds. There now are 50 single-country emerging-markets funds and 15 regional small-cap offerings, plus various other funds with very narrow purviews focused on emerging markets. These include Brazil, Russia, India, and China (BRIC) funds and Europe, Middle East, and Africa (EMEA) offerings in the open-end universe. There also are dozens of exchange-traded funds that are focused on specific countries or regions in the emerging-markets realm.
Though these very narrow funds get lots of attention from the media, most individual investors can safely ignore them. They can get considerable geographic, market-cap and overall breadth in a three-fund portfolio composed of complementary foreign large-cap, diversified emerging-markets and small/mid-cap offerings. Even a two-fund portfolio can provide broad foreign-stock diversification, as long as the funds are chosen carefully.
William Samuel Rocco does not own (actual or beneficial) shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.