Is Home Country Bias Bad in Investing?

Investors often stick to their home stock market, but letting your portfolio get too local is risky

Ian Tam, CFA 29 October, 2020 | 9:05AM

Home bias

Home country bias happens when investors are over-exposed to domestic equities in their investment portfolio. Let’s look at how it happens, and what the pros, cons and worst-case scenarios are when having this bias inherent in your portfolio.

How Does Home Country Bias Happen?

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The information contained within is for educational and informational purposes ONLY. It is not intended nor should it be considered an invitation or inducement to buy or sell a security or securities noted within nor should it be viewed as a communication intended to persuade or incite you to buy or sell security or securities noted within. Any commentary provided is the opinion of the author and should not be considered a personalised recommendation. The information contained within should not be a person's sole basis for making an investment decision. Please contact your financial professional before making an investment decision.

About Author

Ian Tam, CFA  Iam Tam, CFA is Director of Investment Research at Morningstar Canada. 

 

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