Types of International Funds
1. Thematic International Funds: These funds are similar to domestic-themed mutual funds in that the fund invests based on a theme. For Example, a domestic thematic fund with the topic of infrastructure will invest in stocks of cement, electricity, and steel companies. Similarly, an international thematic fund will invest in the stocks of overseas firms that belong to the theme.
2. Region or Country-Specific Funds: As the name implies, these funds invest in the stock markets of a specific region or country. For Example, an international fund that exclusively invests in US stock markets, or a fund that only invests in Asian markets. The primary goal is to profit from opportunities generated by these marketplaces.
3. Global Funds: They are incompatible with regional or country-specific funds rather than focusing on just one country or region, these funds invest globally. They have a portfolio consisting of stocks of companies from all across the world. This implies that they take advantage of opportunities in different markets at the same time. The primary aim here is diversity. Even if one of the markets underperforms, the investor’s investments in other markets will save the day.