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Going Abroad

USAA International takes a trip around the world to create a diverse portfolio.

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This story appears in the August 1997 issue of Entrepreneur. Subscribe »

Don't confine yourself to American stocks." It seemed like such good advice a few years ago. What happened? In the three years ending March 31, 1997, international funds, on average, had a total return of 24 percent, according to Lipper Analytical Services, a mutual fund research company in New York City. In the same period, however, the average domestic equity fund was up a little over twice as much, at 56 percent. For investors who had been enticed by stories of much more rapid growth in overseas markets, these years were a sore disappointment.

This was not a normal period, however, and after such an upset in investing, the scene often changes dramatically. Stocks in countries around the world are now much cheaper relative to domestic stocks. That is clearly a good sign for future performance.

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