INVEST IN SEVERAL GEOGRAPHIC REGIONS

Stock markets do not all move at the same pace. Canadian and North American markets may, for example, slow down while European, Asian and other markets are in a growth phase. Investing in different foreign markets is an excellent way of diversifying your holdings and balancing your portfolio.

Two good reasons to have foreign content

There are at least three good reasons to make room in your portfolio for foreign equities or mutual funds.

1. Canada represents about 4%* of the world's market capitalization

   When you think that the United States represents 30%* of world market capitalization, Europe 24%* and the Asia/Pacific region 31%*, you can see why investing exclusively Canadian will deprive you of potential contributions from strong global markets and the possibility of major gains. Consider adding foreign content to your portfolio without overlooking Canadian markets.

   *Information as at April 1, 2010.

2. An internationally diversified portfolio offers less potential risk and more long-term stability

   Would you go out right now and invest all your money in a single equity? Of course not, that would be too risky. The same applies to putting all your money into Canadian investments. By adding foreign content to your portfolio, you'll reduce your risk through diversification. Financial markets in different countries, like bond and stock markets, do not all move in sync with each other.

MAXIMIZE FOREIGN CONTENT IN YOUR RRSP

The government allows you to hold a maximum of 30% foreign content in your RRSP. If your investor profile recommends that you exceed this percentage, you can invest in 100%-RRSP eligible international RSP funds, whose performance is linked to the return on corresponding foreign funds.