Introduction
Investing in foreign stock markets like Australia’s ASX during a period of great worldwide economic uncertainty may seem like a very risky thing to do. It exposes you to both exchange rate risk as well as macroeconomic and regional risks. It is my intent with this article to explore why such an investment, using low-fee ETFs, could yield investors a better asymmetric risk-return profile than investing solely in the US stock market, let alone in individual stocks such as Amazon. In the interests of keeping this analysis simple I have only considered four factors.