International flavour: Canadian investors may want to make like Ottawa, diversify beyond U.S.
Canada is learning the hard way about the dangers of putting too many eggs in its U.S. economic basket. Much has been made about the need to diversify our economy […]
Canada is learning the hard way that relying too heavily on the U.S. economy can be risky. This realization comes as the country diversifies its economic basket beyond the United States. Diversification is beneficial for any economy or investment portfolio, as it reduces the impact of disruptions in one sector. Canadian investors often hold a "home country bias," meaning they tend to invest in U.S. stocks and bonds.
However, this bias is not unique to Canadians; investors worldwide often prefer investments in their home country. Canadian stocks have outperformed U.S. stocks over the past 15 years, and the Toronto Stock Exchange has beaten the S&P 500 by 17 percentage points since 2025. While the U.S. stock market remains the largest globally, it is becoming increasingly risky due to over-concentration in technology companies and other geopolitical issues.
Canadian investors are increasingly seeking international exposure through ETFs, mutual funds, and individual stocks. High-quality international companies with sustainable advantages are attracting more investment dollars, making diversification a wise strategy for managing economic risk.
Written by urgent.news from Winnipeg Free Press's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
