vania-janet/multiturn-rag-retrieval-data huggingface dataset:
However, please be aware that if you move your money based on historical outperformance, you will be acting on the same cognitive bias that makes gamblers believe they are on a ""hot streak"" and ""can't lose."" They can, and so can you. ======== Edit to answer a more specific line of questions =========== One of your questions is whether it makes sense to buy a number of mutual funds as part of your diversification strategy. This is a slightly more subtle question and I will indicate where there is uncertainty in my answer. Diversifying across asset classes. Most of the gains from diversification are available in a single fund. There is a lot of idiosyncratic risk in one or two stocks and much less in a collection of hundreds of stocks, which is what any mutual fund will hold. Still,you will probably want at least a couple of funds in your portfolio. I will list them from most important to least and I will assume the bulk of your portfolio is in a total US equity fund (or S&P500-style fund) so that you are almost completely diversified already. Risky Bonds. These are corporate, municipal, sovereign debt, and long-term treasury debt funds. There is almost certainly a good deal to be gained by having a portion of your portfolio in bonds, and normally a total market fund will not include bond exposure. Bonds fund returns are closely related to interest rate and inflation changes. They are also exposed to some market risk but it's more efficient to get that from equity. The bond market is very large, so if you did market weights you would have more in bonds than in equity. Normally people do not do this, though. Instead you can get the exposure to interest rates by holding a lesser amount in longer-term bonds, rather than more in shorter-term bonds. I don't believe in shifting your weights toward nor away from this type of bond (as opposed to equity) as you age so if you are getting that advice, know that it is not well-founded in theory. Whatever your relative weight in risky bonds when you are young is should also be your weight when you are older. International.
The US Treasury is not directly/transactionally involved, but can affect the junk bond market by issuing new bonds when rates rise. Since US bonds are considered completely safe, changes in yield will affect low quality debt. For example, if rates rose to levels like 1980, a 12% treasury bond would drive the prices of junk bonds issued today dramatically lower. Another price factor is likelihood of default. Companies with junk credit ratings have lousy balance sheets, so negative economic conditions or tight short term debt markets can result in default for many of these companies. Whether bonds in a fund are new issues or purchased on the secondary market isn't something that is very relevant to the individual investor. The current interest rate environment is factored into the market already via prices of bonds.
High risk foreign debt is great until the bottom falls out of the market when the government default on debt or revalues currency. If you do this, you should be able to sustain near total losses of principal and interest.
No. Bonds don't work like that.  When you buy a bond, you buy pieces of notional at a price. 1K denotes the amount you would get back at maturity (+ coupons), So the smallest piece size would be 1k.  I've even seen 50K plus but thats for more illiquid products....
It is worth noting first that interest and short-term dividends/capital gains are all taxed at the same rate. So all the investments below I mention (even savings accounts) will be taxed at the same rate.  Also, even short-term capital losses can often be harvested to reduce your tax rate in many countries. While it is worth paying attention to the taxes when investing in the short term the more important factor is how much risk that you can take or want to take with the money.  Most equity portfolios like the S&P index give a much higher risk that there will be much less in the account when you need to buy.  You generally have a higher expected return with equity but as you mention that return is very random over such a short period. Over such a short variable period many people will invest in short term bond-index funds or just keep the fund in a high-yielding savings account.  With the savings account your money is guaranteed.  Short term bond funds will have generally higher yields but a small chance you may lose money in the short term. Some people can trade short-term bond indices for free with their broker but if you can't be sure to include the trading costs when thinking about which investment to use as with how low yields are currently the fees may eat up any advantage you gain.
CDs or money market funds. Zero-risk for the CD and ultra-low risk for the money market account; better return than most savings accounts.
U.S. citizens are allowed to own foreign bank and investment accounts. However, there are various financial and tax reporting requirements for owners of such accounts. Even when there is no foreign income involved. For example famous FBAR (Fincen Report Form 114), Form 8938, and even more forms if your assets/activities abroad become more complicated. Penalties, even for unintentional non-compliance can be Draconian. So just keep in mind, that once you start having foreign accounts, you will start having additional obligations and might spend more money and time on tax preparation. If you are ok with that, then its cool. But... assuming your gloomy predictions on Trump presidency come true. They might be accompanied by more strict capital control, reporting requirements, and may become even greater pain in the neck for people with foreign assets. Regarding recommendations, I am not sure about banks, but there are some foreign precious metal investing companies that are completely online based such as https://www.bullionvault.com/ and https://www.goldmoney.com/. These might also guard you from potential problems with US dollar.
Most likely, this will not work they way you think. First things first, to get a loan, the bank needs to accept your collateral. Note that this is not directly related to the question what you plan to do with the loan. Example: you have a portfolio of stocks and bonds worth USD 2 million. The bank decides to give you a loan of USD 1 million against that collateral. The bank doesn't care if you will use the loan to invest in foreign RE or use it up in a casino, it has your collateral as safety. So, from the way you describe it, I take it you don't have the necessary local collateral but you wish to use your foreign investments as such. In this case it really doesn't matter where you live or where you incorporate a company, the bank will only give you the loan if it accepts the foreign collateral. From professional experience with this exact question I can tell you, there are very few banks that will lend against foreign property. And there are even less banks, if any, that will lend against foreign projects. To sum it up: Just forget banks. You might find a private lender to help you out but it will cost you dearly. The best option you have is to find a strategic partner who can cough up the money you need but since he is taking the bigger risk, he will also take the bigger profit share.
"Others have given a lot of advice about how to invest, but as a former expat I wanted to throw this in:  US citizens living and investing overseas can VERY easily run afoul of the IRS.  Laws and regulations designed to prevent offshore tax havens can also make it very difficult for expats to do effective investing and estate planning. Among other things, watch out for: US citizens owe US income tax on world income regardless of where they live or earn money FBAR reporting requirements affect foreign accounts valued over $10k The IRS penalizes (often heavily) certain types of financial accounts. Tax-sheltered accounts (for education, retirement, etc.) are in the crosshairs, and anything the IRS deems a ""foreign-controlled trust"" is especially bad. Heavy taxes on investment not purchased from a US stock exchange Some US states will demand income taxes from former residents (including expats) who cannot prove residency in a different US state. I believe California is neutral in that regard, at least. I am neither a lawyer nor an accountant nor a financial advisor, so please take the above only as a starting point so you know what sorts of questions to ask the relevant experts."
why should I have any bias in favour of my local economy? The main reason is because your expenses are in the local currency.   If you are planning on spending most of your money on foreign travel, that's one thing.  But for most of us, the bulk of our expenses are incurred locally.  So it makes sense for us to invest in things where the investment return is local.   You might argue that you can always exchange foreign results into local currency, and that's true.  But then you have two risks.  One risk you'll have anywhere:  your investments may go down.  The other risk with a foreign investment is that the currency may lose value relative to your currency.  If that happens, even a good performing investment can go down in terms of what it can return to you.  That fund denominated in your currency is really doing these conversions behind the scenes.   Unless the bulk of your purchases are from imports and have prices that fluctuate with your currency, you will probably be better off in local investments.  As a rough rule of thumb, your country's import percentage is a good estimate of how much you should invest globally.  That looks to be about 20% for Australia.  So consider something like 50% local stocks, 20% local bonds, 15% foreign stocks, 5% foreign bonds, and 10% local cash.  That will insulate you a bit from a weak local currency while not leaving you out to dry with a strong local currency.   It's possible that your particular expenses might be more (or less) vulnerable to foreign price fluctuations than the typical.  But hopefully this gives you a starting point until you can come up with a way of estimating your personal vulnerability.
"In addition to @MD-tech's answer: I'd distinguish between stock of a foreign company traded in local currency at a local exchange from the same stock traded in the foreign currency at a foreign exchange (and maybe with a foreign bank holding your accounts). The latter option will typically have higher variation because of exchange rate, and (usually) higher risks associated with possibility of recovery, (double) taxation and the possible legal difficulties @MD-tech mentions. Trading the foreign stock at a local exchange may mean that the transaction volume is far lower than at their ""home"" exchange. Holding stock of companies working in foreign markets OTOH can be seen as diversification and may lower your risk. If you only invest in the local market, your investments may be subject to the same economic fluctuations that your wage/employment/pension situation is subject to - it may be good to try de-correlating this a bit. Of course, depending on political circumstances in your home country, foreign investments may be less risky (though I'd suspect these home countries also come with a high risk of seizing foreign investments...)"
"You sound like you know what you're talking about, but you say:  ""foreign buyers will laugh at them""  But the Wall Street Journal, 9/20/12, says that in the last quarter FOREIGN INVESTORS ARE FLOCKING TO BUY JAPANESE BONDS IN RECORD LEVELS even though the yields are very much below other industrialized countries. LOL"
"While you’re new or relatively new to this idea then the fitting idea is to perform a little research and primary get conversant in what’s possible with offshore investment opportunities.  I couldn't agree more. A good way to begin this research would be to do an online search for an investment opportunity called ""Royal Siam Trust."""
Foreign stocks have two extra sources of risk attached to them; exchange rate and political.  Exchange rate risk is obvious; if I buy a stock in a foreign currency and there is a currency movement that makes that investment worth less I lose money no matter what the stock does. This can be offset using exchange rate swaps. (This is ceteris paribus, of course; changes in exchange rate can give a comparative advantage to international and exporting companies that will improve the fundamentals and so increase the price of the stock relative to a local firm. The economics of the firms in particular are not explored in this answer as it would get too complicated and long if I did.) Political risk relates not only to the problems surrounding international politics such as a country deciding that foreign nationals may no longer own shares in their national industries or deciding to seize foreign nationals' assets as happens in some areas. Your home country may also decide to apply sanctions to the country in which you are invested thus making it impossible to get your money back even though the foreign country will allow you to redeem them or sell. Diplomatic relations and trade agreements tend to be difficult. There are further problems in lack of understanding of foreign countries' laws, tax code, customs etc. relating to investments and the necessity to find legal representation in a country you may never have visited if there are issues. There is also a hidden risk in that, as an individual investor, you are not likely to be reading the local financial news for that country regularly enough to spot company specific issues arising. By the time these issues get into international media its far too late as all of the local investors have sold out of their positions already. The risks are probably no different if you have the time to monitor international relations and the foreign country's news, and have FX swaps in place to counteract FX risk as the funds and investment banks do but as an individual investor the time required is not feasible.
Not sure of your locality. In the USA, there are many options. There are many corporate bonds that pay interest monthly. You can invest in a handful of bonds, chosen so at least one of them pays interest each month. (Minimum investment requirements make this an expensive option)  Unit Trusts made of bonds (a handful of bonds wrapped into a single fixed investment) usually pay monthly interest. As the bonds begin to mature, the interest payments shrink (but you begin to get principal payments which can be reinvested). Bond mutual funds and ETFs usually provide monthly dividends (that come from the interest and capital gains of the bonds held by the fund). Dividends are usually consistent, but not necessarily fixed.  You can produce a monthly income from stocks in the same way as the above mentioned bond methods. Income can be consistent, but not fixed.
First, currencies are not an investment; they are a medium of exchange; that is, you use currency to buy goods and services and/or investments. The goods and services you intend to buy in your retirement are presumably going to be bought in your country; to buy these you will need your country's currency. The investments you intend to buy now require the currency of whatever country they are located in. If you want to buy shares in Microsoft you need USD; if you want shares in BHP-Billiton you need AUD or GBP (It is traded on two exchanges), if you want property in Kuwait you need KWD and if you want bonds in your country you need IDR. When you sell these later to buy the goods and services you were saving for you need to convert from whatever currency you get for selling them into whatever currency you need to buy. When you invest you are taking on risk for which you expect to be compensated for - the higher the risk you take the better the returns had better be because there is always the chance that they will be negative, right down to losing it all if you are unlucky. There is no 100% safe investment; if you want to make sure you get full value for your money spend it all right now! If you invest overseas then, in addition to all the other investment risks, you are adding currency risk as well. That is, the risk that when you redeem your investments the overseas currency will have fallen relative you your currency. One of the best ways of mitigating risk is diversification; which allows the same return at a lower risk (or a higher return at the same risk). A pure equity portfolio is not diversified across asset classes (hopefully it is diversified across the equities). Equities are a high risk-high yield class; particularly in a developing economy like Indonesia. If you are very young with a decades long investment horizon this may be OK but even then, a diversified portfolio will probably offer better rewards at the same risk. Diversifying into local cash, bonds and property with a little foreign equities, bonds and property will serve you better than worrying about the strength of the IDR. Oh, and pay a professional for some real advice rather than listening to strangers on the internet.
"You might find some of the answers here helpful; the question is different, but has some similar concerns, such as a changing economic environment. What approach should I take to best protect my wealth against currency   devaluation & poor growth prospects. I want to avoid selling off any   more of my local index funds in a panic as I want to hold long term.   Does my portfolio balance make sense? Good question; I can't even get US banks to answer questions like this, such as ""What happens if they try to nationalize all bank accounts like in the Soviet Union?""  Response: it'll never happen. The question was what if! I think that your portfolio carries a lot of risk, but also offsets what you're worried about.  Outside of government confiscation of foreign accounts (if your foreign investments are held through a local brokerage), you should be good.  What to do about government confiscation?  Even the US government (in 1933) confiscated physical gold (and they made it illegal to own) - so even physical resources can be confiscated during hard times. Quite a large portion of my foreign investments have been bought at an   expensive time when our currency is already around historic lows,   which does concern me in the event that it strengthens in future. What   strategy should I take in the future if/when my local currency starts   the strengthen...do I hold my foreign investments through it and just   trust in cost averaging long term, or try sell them off to avoid the   devaluation? Are these foreign investments a hedge?  If so, then you shouldn't worry if your currency does strengthen; they serve the purpose of hedging the local environment.  If these investments are not a hedge, then timing will matter and you'll want to sell and buy your currency before it does strengthen.  The risk on this latter point is that your timing will be wrong."
I looked into the investopedia one (all their videos are mazing), but that detail just was not clear to me, it also makes be wonder, if a country issues bonds to finance itself, what happens at maturity when literally millions of them  need to be paid? The income needs to have grown to that level or it defaults? Wouldn't all the countries default if that was the case, or are bonds being issued to being able to pay maturity of older bonds already?  (I'm freaking myself out by realizing this)
I strongly recommend you to invest in either stocks or bonds. Both markets have very strict regulations, and usually follow international standards of governance. Plus, they are closely supervised by local governments, since they look to serve the interests of capital holders in order to attract foreign investment. Real estate investment is not all risky, but regulations tend to be very localized. There are federal, state/county laws and byelaws, the last usually being the most significant in terms of costs (city taxes) and zoning. So if they ever change, that could ruin your investment. Keeping up with them would be hard work, because of language, legal and distance issues (visiting notary's office to sign papers, for example). Another thing to consider is, specially on rural distant areas, the risk of forgers taking your land. In poorer countries you could also face the problem of land invasion, both urban and rural. Solution for that depends on a harsh (fast) or socially populist (slow) local government. Small businesses are out of question for you, frankly. The list of risks (cash stealing, accounting misleading, etc.) is such that you will lose money. Even if you ran the business in your hometown it would not be easy right?
"Unless you are buying a significant value of your goods in USD then the relative strength of USD versus your local currency will have little to no effect on what the value of your investments is worth to you. In fact only (de|in)flation will effect your purchasing power. If your investments are in your local currency and your future expenses (usage of the returns on the investments) will be in your local currency FX has no effect. To answer your question, however, since all investments involve flows of money there can be no investment (other than perhaps gold which is really a form of currency) that isn't bound to at least one currency. In general investments are expected to be valued against the investor's home currency (I tend to call it ""fund currency"" as I work with hedge funds) as the return on the investment will be paid out in the fund currency and returns will be compared on the same basis. If investments are to be made internationally then it is necessary to reduce, or ""hedge"" the exchange rate risk. This is normally done using FX swaps or futures that allow an exchange rate in the future to be locked in today. Far from being unbound from FX moves these derivatives are closely bound to any moves but crucially are bound in the opposite direction to the hoped for FX move. an example of this would be if I'm investing 100GBP (my local currency) in a US company XYZ corp which I expect to do well. Suppose I get 200USD for my 100GBP and so buy 1 * 200USD shares in XYZ. No matter what happens to XYZ stock any move in GBP/USD will affect my P&L so I buy a future that allows me to exchange 200USD for 100GBP in 6 month's time. If GBP rises I can sell the future and make money on both the higher exchange rate and the increase in XYZ corp. If GBP falls I can keep the future until maturity and exchange the 200USD from XYZ corp for 100GBP so I only take the foreign exchange hit on any profits. If I expect my profits to be 10USD I can even buy futures such that I can lock in the exchange rate for 110USD in 6 months so that I will lose even less of my profit from the exchange rate move."
Apple is currently the most valuable company in the world by market capitalisation and it has issued bonds for instance. Amazon have also issued bonds in the past as have Google. One of many reasons companies may issue bonds is to reduce their tax bill. If a company is a multinational it may have foreign earnings that would incur a tax bill if they were transferred to the holding company's jurisdiction. The company can however issue bonds backed by the foreign cash pile. It can then use the bond cash to pay dividends to shareholders. Ratings Agencies such as Moody's, Fitch and Standard & Poor's exist to rate companies ability to make repayments on debt they issue. Investors can read their reports to help make a determination as to whether to invest in bond issues. Of course investors also need to determine whether they believe the Ratings Agencies assesments.
It's the same as with equities. If you're just buying foreign currencies to hold, you can't lose more than you invest. But if you're buying derivatives (e.g. forward contracts or spread bets), or borrowing to buy on margin, you can certainly lose more than you invest.
If you are a US citizen, you need to very carefully research the US tax implications of investing in foreign stocks before you do so. The US tax rules have been set up in general to make this very unattractive.