Nowadays, international investing is not a new concept. Although we all know that risk is related in any single investment, it is actually special when it comes to international investing. According to the SEC, there are several categories of international investment’s risk, such as, changes in currency exchange rate, dramatic changes in market value, political, economic, and social events, lack of liquidity, less information, reliance on foreign legal remedies, and different market operations. However, due to its attractiveness of return, international investing is an essence in today’s business world. Thus, the definition of international diversification is necessary to understand: “By diversifying across nations whose economic cycles are not perfectly in phase-investors should be able to reduce still further the variability of their returns”. In the positive side, international investing offers more opportunities than a purely domestic portfolio. Just think about it, if an investor has all of his/her asset in U.S market, what would be the outcome when the market is in recession (like right now)? Yes, we could all see that outcome is not pretty. He/she could lose all the money. However, if the assets are diversified oversea, the risk is also spread out. And as a result, although there might be a loss, it would not be as bad as it would be with the purely U.S portfolio. Another advantage of investing internationally is its attractiveness of investment overseas. According to our textbook, most of the big and highly profitable manufacturers are overseas. Thus, investing overseas might give the investors the better return compared to the domestic’s return rate.  However, if we look at the negative side of investing internationally, there are several disadvantages as well. Firstly, international investing can be more expensive than investing in U.S. companies. In smaller markets, you may have to pay a premium to purchase shares of popular companies. In some countries there may be unexpected taxes, such as withholding taxes on dividends. Transaction costs such as fees, broker’s commissions, and taxes often are higher than in U.S. markets. Mutual funds that invest abroad often have higher fees and expenses than funds that invest in U.S. stocks, in part because of the extra expense of trading in foreign markets. More than that, there are some legal and political barriers as well.  Overall, it is safe to say that if an international portfolio is monitored wisely and carefully, it is the safest way to diversify your portfolio in order to receive the highest return.