Foreign investment funds
International investing can lead to a substantial diversification of your portfolio, however one of the first decisions that should be made is about choosing whether it will be on stocks or on a foreign investment funds. If you are not an experienced investor, a good diversified international investment fund formed by a reputable company will offer access to a wider range of securities without high trading costs, since the company itself will gain economies of scales in operations.
Nevertheless, there is one major issue that needs to be taken under consideration. Some foreign jurisdictions offering tax exemptions for International (offshore) companies might not be part of any tax treaties. So the decision over foreign investment funds should be associated with the most advantageous jurisdiction.
Advantages of international investment funds
The international investment funds offer two big advantages. One is access to professional portfolio managers who are fully aware of the global markets and trends and the second is instant diversification. Consequently, the right choice of professional management and of the most advantageous jurisdiction could lead to substantial profits.
This is why Cyprus, for example, would be an ideal choice –not only for investment funds but also for establishing holding companies -, since it’s part of the Double Taxation Treaties network together with 41 more countries and does not impose any withholding taxes over outbound dividends. Also foreign investments funds established in Cyprus do not entail any hidden taxes.