Discuss three reasons for adding international securities

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Alessandra Capital has been experiencing increasing demand from its institutional clients for information and assistance related to international investment management. Recognizing that this is an area of growing importance, the firm has hired an experienced analyst/portfolio manager specializing in international equities and market strategy. His first assignment is to represent Alessandra Capital before a client company's investment committee to discuss the possibility of changing their present "U.S. securities only" investment approach to one including international investments. He is told that the committee wants a presentation that fully and objectively examines the basic, substantive considerations on which the committee should focus its attention, including both theory and evidence. The company's pension plan has no legal or other barriers to adoption of an international approach; no non-U.S. pension liabilities currently exist. Identify and briefly discuss three reasons for adding international securities to the pension portfolio and three problems associated with such an approach.

Reference no: EM13262402

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