As 2019 comes to an end, our thoughts turn to
investing strategies for 2020. With this issue in
mind, we noticed an article on CNN Business,
about it being time to dump U.S. stocks.
For all the concerns about slowing US
economic growth, there's consensus that
stocks can continue to rise.
But for the best returns, strategists and
portfolio managers have indicated they'll look
Neil Dwane, portfolio manager and global
strategist at Allianz Global Investors, thinks that
the heated run-up to the 2020 election is likely to
weigh on prices.
"While the United States has offered investors
strong returns for many years now, the country
will likely spend much of next year grappling with
growing political uncertainty," he wrote in an op-
ed for CNN Business. "The real investment
opportunities in 2020 may very well be found
Our belief is that the very partisan election
campaign will not adversely affect the stock
market so long as earnings continue. However,
the now-certain-to-be-long-term trade war, the
ever-increasing US debt, and a generally
slowing global economy are likely to affect the
No matter why it will happen, the U.S. market is
likely to slow down and well-chosen
investments elsewhere will flourish.
Where to Invest outside of the USA
In our recent article about safe investments in
an uncertain world, we published a map of
the world from OECD, color-coded for
expected economic growth.The only nation
in theWestern Hemisphere predicted to
experience better than 3% growth is
In Europe, only Spain, Poland, andTurkey are
likely to grow faster than 3%. And all of the
4%, 5%, and better growth rates are
expected to occur in South and East Asia.
India stands out with a predicted rate of
economic growth greater than 6%.
TheABC (anywhere but China) movement is
likely to continue and countries like Indonesia,
Vietnam, and India are likely to benefit.A good
place to look for cues about where the smart
money is going is theWorld Bank’s yearly report
on foreign direct investment.
Although the world’s two largest economies,
The U.S.A. and China receive the greatest cash
inflows, the table that theWorld Bank publishes
each year gives you a good idea of where else
investment capital is going and if the trend is up
How to Safely Invest Outside of the USA
Since you probably do not speak many
foreign languages and do not have someone
“on the ground” in Indonesia, India, or
anywhere else in South and East Asia (or
Colombia, Spain, Poland, andTurkey), you
need a safe way to invest your money.
And, you need to be able to do the same sort of
fundamental analysis that you do when
investing in stocks in the USA.The route that
many investors take is to purchaseAmerican
Depositary Receipts.As Investopedia explains.
An American depositary receipt (ADR) is a
negotiable certificate issued by a U.S. depository
bank representing a specified number of shares or
as little as one share investment in a foreign
company's stock.The ADR trades on markets in
the U.S. as any stock would trade.
ADRs represent a feasible, liquid way for U.S.
investors to purchase stock in companies abroad.
Foreign firms also benefit from ADRs, as they
make it easier to attract American investors and
capital without the hassle and expense of listing
themselves on U.S. stock exchanges.
The certificates also provide access to foreign
listed companies that would not be open to U.S.
The best route is to only purchase level three
ADRs.They are subject to full SEC reporting
requirements so that you can just as easily
analyze them as you would a US stock.
As an example, follow this link to see Indonesian
ADRs. It is of note that only one ADR of an
Indonesian company trades on the NYSE.As a
fixed lineTelecomCompany this is not an
internationally famous company but it is one
that will grow as the Indonesian economy
You can also check out ADRs for any of the
other nations with higher projected growth
rates in you are wondering where to invest
outside of the USA.
For more insights and useful information about
investments and investing, visit