vania-janet/multiturn-rag-retrieval-data huggingface dataset:
In today's market, for most investors there is generally no need to invest directly in foreign market indices since you can do so indirectly on the Toronto stock market. The large Canadian ETF providers offer a wide range of US, European, Asian, and Global ETFs as well as Canadian ETFs. For example, you can track all of the major US indices by trading in Toronto in Canadian dollars. The S&P500, the Dow Jones, and the NASDAQ100 are offered in both ""currency hedged"" and ""unhedged"" forms. In addition, there are ETFs on the total US Market, US Small Caps, US sectors such as banks, and more exotic ETFs such as those offering ""covered call"" strategies and ""put write"" strategies. Here is a link to the BMO ETF website. Here is a link to the iShares (Canada) ETF website."
It looks like you need a lot more education on the subject. I suggest you pick up a book on investing and portfolio management to get a first idea. Dividend yields are currently way below 5% on blue chips. Unlike coupons from fixed income instruments (which, in the same risk category, pay a lot less), dividend yields are not guaranteed and neither is the invested principal amount.  In either case, your calculation is far away from reality.  Sure, there are investments (such as the mentioned direct investments in companies or housings in emerging economies) that can potentially earn you two digit percentage returns. Just remember: risk always goes both ways. A higher earning potential means higher loss potential. Also, a direct investment is a lot less liquid than an investment on a publicly quoted high turnover market place. If you suddenly need money, you really don't want to be pressed to sell real estate in an emerging market (keyword: bid ask spread). My advice: the money that you can set aside for the long term (10 years plus), invest it in stock ETFs, globally. Everything else should be invested in bond funds or even deposits, depending on when you will need the access. As others have pointed out, consider getting professional advice.
Taking into account that you are in Cyprus, a Euro country, you should not invest in USD as the USA and China are starting a currency war that will benefit the Euro. Meaning, if you buy USD today, they will be worth less in a couple of months. As for the way of investing your money. Look at it like a boat race, starting on the 1st of January and ending on the 31st of December each year. There are a lot of boats in the water. Some are small, some are big, some are whole fleets. Your objective is to choose the fastest boat at any time. If you invest all of your money in one small boat, that might sink before the end of the year, you are putting yourself at risk. Say: Startup Capital. If you invest all of your money in a medium sized boat, you still run the risk of it sinking. Say: Stock market stock. If you invest all of your money in a supertanker, the risk of it sinking is smaller, and the probability of it ending first in the race is also smaller. Say: a stock of a multinational. A fleet is limited by it's slowest boat, but it will surely reach the shore. Say: a fund. Now investing money is time consuming, and you may not have the money to create your own portfolio (your own fleet). So a fund should be your choice. However, there are a lot of funds out there, and not all funds perform the same.  Most funds are compared with their index. A 3 star Morningstar rated fund is performing on par with it's index for a time period. A 4 or 5 star rated fund is doing better than it's index. Most funds fluctuate between ratings. A 4 star rated fund can be mismanaged and in a number of months become a 2 star rated fund. Or the other way around. But it's not just luck. Depending on the money you have available, your best bet is to buy a number of star rated, managed funds. There are a lot of factors to keep into account. Currency is one. Geography, Sector... Don't buy for less than 1.000€ in one fund, and don't buy more than 10 funds. Stay away from Gold, unless you want to speculate (short term). Stay away from the USD (for now). And if you can prevent it, don't put all your eggs in one basket.
So your accountant certainly knows much more than I do about Israeli tax law and its interactions with US tax law, which is zero.  I'm going to look at this problem from the investment perspective which I hope to convince you is the most important place to start. Then you can adjust for interactions between the Isreali and US tax codes. Even if the tax breaks are exceptional, it would be hard to recommend buying real estate as an investment in the 7-10 year time frame.  Especially if this real estate is in the US.  Open/Closing fees, mortgage fees, risk of property devaluation, bad-renters, acts of god, insurance costs and tax complications make short to medium term investments in real estate a particularly risky way to invest.  Buying a local apartment and renting is somewhat more reasonable as you don't have to worry about the currency conversion and you can do a lot more research in your local environment and keep a closer eye on the property, it is  still this a pretty concentrated risk. Saving and investing using tax-advantaged accounts is generally considered a great way to build toward a down payment in the medium term.  A mixture of mostly local bonds with some local and foreign stocks and more and more cash as it gets close to purchase time is generally what is recommended when saving for a home.  This mixture is relatively safe and will tend to grow steadily without the concentrated risk of a real estate investment.  PFIC rules are complicated and certainly worth taking some time to understand, but owning real estate especially in a foreign country seems much more complicated and certainly riskier. There may be some rule that makes investing in REITs much better than normal stocks in these particular accounts though I would be surprised if that were the case.  It is generally not true for people under just he US tax code. So while option (1) may not be the absolute best from a tax perspective it would certainly be my guess as the most likely to succeed.
"This is an old post I feel requires some more love for completeness. Though several responses have mentioned the inherent risks that currency speculation, leverage, and frequent trading of stocks or currencies bring about, more information, and possibly a combination of answers, is necessary to fully answer this question. My answer should probably not be the answer, just some additional information to help aid your (and others') decision(s). Firstly, as a retail investor, don't trade forex. Period. Major currency pairs arguably make up the most efficient market in the world, and as a layman, that puts you at a severe disadvantage. You mentioned you were a student—since you have something else to do other than trade currencies, implicitly you cannot spend all of your time researching, monitoring, and investigating the various (infinite) drivers of currency return. Since major financial institutions such as banks, broker-dealers, hedge-funds, brokerages, inter-dealer-brokers, mutual funds, ETF companies, etc..., do have highly intelligent people researching, monitoring, and investigating the various drivers of currency return at all times, you're unlikely to win against the opposing trader. Not impossible to win, just improbable; over time, that probability will rob you clean. Secondly, investing in individual businesses can be a worthwhile endeavor and, especially as a young student, one that could pay dividends (pun intended!) for a very long time. That being said, what I mentioned above also holds true for many large-capitalization equities—there are thousands, maybe millions, of very intelligent people who do nothing other than research a few individual stocks and are often paid quite handsomely to do so. As with forex, you will often be at a severe informational disadvantage when trading. So, view any purchase of a stock as a very long-term commitment—at least five years. And if you're going to invest in a stock, you must review the company's financial history—that means poring through 10-K/Q for several years (I typically examine a minimum ten years of financial statements) and reading the notes to the financial statements.
Forex trading contracts are generally fairly short dated as you mention.  Months to weeks.  Professional forex traders often extend the length of their bet by rolling monthly or quarterly contracts.  Closing a contract out a few days before it would expire and reopening a new contract for the next quarter/month.  This process can be rather expensive and time consuming for a retail investor however. A more practical (but also not great) method would be to look into currency ETFs.  The ETFs generally do the above process for you and are significantly more convenient.  However, depending on the broker these may not be available and when available can be illiquid and/or expensive even in major currency pairs.  It's worth a bunch of research before you buy. Note, in both cases you are in a practical sense doubling your NOK exposure as your home currency is NOK as well.  This may be riskier than many people would care to be with their retirement money.  An adverse move would, at the same time you would lose money, make it much to buy foreign goods, which frankly is most goods in a small open country like Norway. The most simple solution would be to overweight local NOK stocks or if you believe stocks are overvalued as you mention NOK denominated bonds.  With this you keep your NOK exposure (a currency you believe will appreciate) without doubling it as well as add expected returns above inflation from the stock growth/dividends or bond real interest rates.
The other obvious suggestion I guess is to buy cheap stocks and bonds (maybe in a dollar denominated fund). If the US dollar rises you'd then get both the fund's US gains plus currency gains. However, no guarantee the US dollar will rise or when.  Perhaps a more prudent approach is to simply diversify. Buy both domestic and foreign stocks and bonds. Rebalance regularly.
However, recent political events back in the States have me (and, I'm sure, every currency speculator and foreign investor) worried that this advantage will not last for much longer. If currency speculators expect exchange rates to fall, then they'd have already bid down the rates. I.e. they'd keep speculating until the rates did fall. So the speculators expect the current rates are correct, otherwise they'd move them. Donald Trump's state goal is to increase exports relative to imports. If he's successful, this could cause the US dollar to fall to make exports cheaper and imports more expensive. However, if his policies fail, then the opposite is likely to happen. Most of his announced trade policies are more likely to increase the value of the dollar than to decrease it. In particular, that is the likely result of increased tariffs. If you are worried about Trump failing, then you should worry about a strong dollar. That's more in line with actual speculation since the election. I don't know that I'd make a strong bet in either direction. Hedging makes more sense to me, as it simply locks in the current situation, which you apparently find favorable. Not hedging at all might produce some profit if the dollar goes up. Gambling all your funds might produce some profit if the dollar goes down. The middle path of hedging just what you're spending is the safest if least likely to produce profit. My recommendation is to hedge the six months expenses and enjoy your time abroad. Why worry about political events that you can't control? Enjoy your working (studying) vacation."
it looks like using an ADR is the way to go here.  michelin has an ADR listed OTC as MGDDY. since it is an ADR it is technically a US company that just happens to be a shell company holding only shares of michelin. as such, there should not be any odd tax or currency implications. while it is an OTC stock, it should settle in the US just like any other US OTC. obviously, you are exposing yourself to exchange rate fluctuations, but since michelin derives much of it's income from the US, it should perform similarly to other multinational companies. notes on brokers: most US brokers should be able to sell you OTC stocks using their regular rates (e.g. etrade, tradeking). however, it looks like robinhood.com does not offer this option (yet). in particular, i confirmed directly from tradeking that the 75$ foreign settlement fee does not apply to MGDDY because it is an ADR, and not a (non-ADR) foreign security.
"The point of reissuing the bonds with other bonds is that people could step away from the greenback money supply if they so chose to.  There you could switch between various and distinct money supplies just by trading places with someone whenever you feel like.  Of course, the firm would only issue the bonds if they thought they could repay it, and it would be backed by the actual good they produce, not just the ""word"" of the government and not just thin air."
From your own cite:  &gt; Sales were offset by China increasing its holdings   But it's an article from March.  From the same source, but in June:  &gt; [Global investors have piled into US government bonds this year, drawn by the allure of high yields.](http://www.ft.com/intl/cms/s/0/6907c2a0-f24a-11e3-ac7a-00144feabdc0.html#axzz3AlhYHl8A)  &gt; At a time when the Federal Reserve has steadily reduced bond purchases since January and announced a further reduction at Wednesday’s policy meeting, foreign buyers have effectively stepped up, followed by domestic banks.
A foreign stock mutual fund definitely belongs in stocks. It's composed of stocks.  Your self occupied house is definitely real estate. You don have to keep in mind,however that selling it would create costs such as rent. I wouldn't leave it out, if doing that would cause you to buy more real estate. This would cause you to be overweighted in the real estate area.  I would tend to think if a CD as cash. While it could be considered a bond, as you said the principal doesn't go down.  The REIT is the toughest one. I would really like to see a graph showing how correlated it is to the real estate market. That would determine where I would put it.
"Hmm... Maybe I somewhat misunderstood your question then.  Yes, trade deficits/surpluses are really the core of the country-level ""investment"".  But yes, it maters what they *do* with it, which is **why** so many countries put any excesses into US treasuries.   Going back to ""personal"" finance, if they pay down higher interest debt with their trade surplus, *great*; if they have no debt and can issue local currency (in PF land, ""take out a loan"") for under 2%, *great*;  If not... **Not** so great.  ""Saving"" money that costs over 2% isn't an investment, it's nothing but a loan disguised as one."
"Without knowing anything else about you, I'd say I need more information. If all of your investments are in stocks, then that's not really diversified, regardless of how many stocks you own.  There are other things to invest in besides stocks (and bonds, for that matter). What countries?  ""International"" is pretty broad, and some countries are better bets than others at the moment. If you're old, I'd say very little of your money should be in stocks anyway. I'd also seek financial advice that is tailored to your goals, sophistication, etc."
"You could do nothing for a while longer. Foreign exchange simply means your services are cheaper and imports and more expensive, local transactions are otherwise unaffected. Your main worry is whether the government's attempts to revert these issues will create inflation within Russia.  Local clients will likely not care to pay you in Euros, Dollars, or Pounds (as it will cost them significantly more, they'd have to acquire the currency to pay you with) but does it matter if they pay in Roubles? The financial crisis in more an international thing, not a local one. Now it is possible there will be inflation setting in but I doubt the powers that be will allow that to happen... If you are concerned about it, buying non-liquid assets are the thing to do - a house will still be worth ""1 house"" no matter what a 1-million rouble note will buy you in a year's time. Similarly, you can invest in 'blue-chip' stocks that should be a good hedge against any further inflation (the rich don't tend to turn poor in difficult times!) In the meantime, get some international clients - as the Rouble is so low, relatively speaking, your services are very competitive. The rest of the time, is to wait it out a little - nobody knows what will happen, but in my knowledge of history interest rates like this drop back to something much closer to normal quite quickly."
Your definition of 'outside your country' might need some redefinition, as there are three different things going on here . . . Your financial adviser appears to be highlighting the currency risk associated with point three. However, consider these risk scenarios . . . A) Your country enters a period of severe financial difficulty, and money markets shut down. Your brokerage becomes insolvent, and your investments are lost. In this scenario the fact of whether your investments were in an overseas index such as the S&P, or were purchased from an account denominated in a different currency, would be irrelevant. The only thing that would have mitigated this scenario is an account with an overseas broker. B) Your country's stock market enters a sustained and deep bear market, decimating the value of shares in its companies. In this scenario the fact of whether your investments were made in from a brokerage overseas, or were purchased from an account denominated in a different currency, would be irrelevant. The only thing that would have mitigate this scenario is investment in shares and indices outside your home country. Your adviser has a good point; as long as you intend to enjoy your retirement in your home country then it might be advisable to remove currency risk by holding an account in Rupees. However, you might like to consider reducing the other forms of risk by holding non-Indian securities to create a globally diversified portfolio, and also placing some of your capital in an account with a broker outside your home country (this may be very difficult to do in practice).
An index fund is probably the ideal way to start a portfolio - easy, and you get a lot of diversification. Later, when you have more money available, you can consider adding individual stocks or investing in specific sectors or regions. (Someone else suggested Brazil/Russia/Indo-China, or BRICs - having some money invested in that region isn't necessarily a bad idea, but putting all or most of your money in that region would be. If BRICs are more of your portfolio then they are of the world economy, your portfolio isn't balanced. Also, while these countries are experiencing a lot of economic growth, that doesn't always mean that the companies that you own stock in are the ones which will benefit; small businesses and new ventures may make up a significant part of that growth.) Bond funds are useful when you want to diversify your portfolio so that it's not all stocks. There's a bunch of portfolio theory built around asset allocation strategies. The idea is that you should try to maintain a target mix of assets, whatever the market's doing. The basic simplified guideline about investing for retirement says that your portfolio should have (your age)% in bonds (e.g. a 30-year-old should have 30% in bonds, a 50-year-old 50%.) This helps maintain a balance between the volatility of your portfolio (the stock market's ups and downs) and the rate of return: you want to earn money when you can, but when it's almost time to spend it, you don't want a sudden stock market crash to wipe it all out. Bonds help preserve that value (but don't have as nice of a return). The other idea behind asset allocation is that if the market changes - e.g. your stocks go up a lot while your bonds stagnate - you rebalance and buy more bonds. If the stock market subsequently crashes, you move some of your bond money back into stocks. This basically means that you buy low and sell high, just by maintaining your asset allocation. This is generally more reliable than trying to ""time the market"" and move into an asset class before it goes up (and move out before it goes down). Market-timing is just speculation.
For investments priced in EUR that invest in securities priced in USD, the presence of this additional currency risk mandates the use of a hedge if the indexes are going to track. The fund you linked to uses swap contracts, which I discuss in detail below, to hedge against fluctuations in the EUR/USD exchange rate. Since these derivatives aren't free, the cost of the hedge is included in the expenses of the fund and may result in differences between the S&P500 Index and the S&P 500 Euro Hedged Index. Also, it's important to realize that any time you invest in securities that are priced in a different currency than your own, you take on currency risk whether or not the investments aim to track indexes. This holds true even for securities that trade on an exchange in your local currency, like ADR's or GDR's. I wrote an answer that goes through a simple example in a similar fashion to the one above in that context, so you can read that for more information on currency risk in that context. There are several ways to investors, be they institutional or individual, can hedge against currency risk. iShares offers an ETF that tracks the S&P500 Euro Hedged Index and uses a over-the-counter currency swap contract called a month forward FX contract to hedge against the associated currency risk. In these contracts, two parties agree to swap some amount of one currency for another amount of another currency, at some time in the future. This allows both parties to effectively lock in an exchange rate for a given time period (a month in the case of the iShares ETF) and therefore protect themselves against exchange rate fluctuations in that period. There are other forms of currency swaps, equity swaps, etc. that could be used to hedge against currency risk. In general, two parties agree to swap one quantity, like a EUR cash flow, payments of a fixed interest rate, etc. for another quantity, like a USD cash flow, payments based on a floating interest rate, etc. In many cases these are over-the-counter transactions, there isn't necessarily a standardized definition.
Well, if that's the case the whole article is rubbish because it's not Goldman-Sachs who are excluded, but practically everyone.  This [Vanguard Emerging Markets Government Bond fund](https://personal.vanguard.com/us/funds/snapshot?FundIntExt=INT&amp;FundId=3820#tab=2), which you might have in your 401k, is holding $26M worth of them. That was the first place I thought to look for Venezuelan bonds - I'd expect practically every global emerging markets bond fund would be holding some.  [The executive order only applies to some new funds which have been issued to two government entities and which appear not to have been sold outside Venezuela yet.](https://www.bloomberg.com/news/articles/2017-08-25/with-u-s-bond-sanctions-walls-close-in-on-venezuela-s-regime)  Edit: [another article from Bloomberg](https://www.bloomberg.com/gadfly/articles/2017-08-25/it-s-hard-to-quit-venezuela-s-debt-when-it-pays-so-well):  &gt; And yet investors have actually been warming up to Venezuelan bonds in the past week. The nation's dollar-denominated debt has gained nearly 1 percent in the period, while notes of the state-owned Petroleos de Venezuela have returned 1.7 percent.   &gt; … anyone who's been plowing money into emerging-market bond funds recently is most likely also investing in Venezuela because its debt makes up about 2 percent of a main broad benchmark that many EM investors use as a guide.