International Investing with iShares ETFs
Australia represents only 2% of global capital markets, yet many Australian investors allocate a significant proportion of their investment portfolios to domestic shares, failing to capitalise on opportunities overseas.
Constructing a portfolio that combines domestic and international investments can result in a more diversified portfolio with unique opportunities for growth. Foreign markets account for nearly 98% of global capital markets. Adding international ETFs such as iShares to a portfolio can provide access to the growth potential of new technologies, emerging countries and industries that do not exist in Australia. In addition, international ETFs can also help to reduce risk by introducing a less correlated asset class.
International ETFs can be linked to indexes that are as broad as the world, Europe, or developed markets (European, Australasian, and Far Eastern markets). For more targeted exposure, they can be as narrow as an individual country or a sector within a country (for example, technology).
Top 15 Countries by exchange market capitalisation as at December 2008

*EuroNext operates cash and derivatives exchanges in Belgium, France, the Netherlands and Portugal and services for derivatives in the UK.
Source: World Federation of Exchanges; calculations by iShares
International ETF Investment Risks
Investing in iShares involves exposure to international markets. In addition to the normal risks associated with investing, international investments may involve the risk of losing all or part of any capital from unfavourable fluctuations in currency values, from differences in generally accepted accounting principles or from economic or political instability in other nations. An investment in emerging markets and single countries may also involve other heightened risks such as increased volatility and the possibility of lower trading volume. Past performance is not a reliable indicator of future performance. Payment of dividends is not guaranteed. Unfavourable fluctuations in exchange rates may impact the value of any dividends payable. The performance of iShares ETFs is not guaranteed by any foreign or Australian regulatory or depositary institution.
