I grew up with a padded passport, but I didn't like it at the time. My parents had a penchant for global summer family vacations, and I was the reluctant globetrotter. My sisters loved it, but I was the brooding teenager with the Walkman on, cursing the parties and television shows that I was missing. Meanwhile, amazing destinations in Europe, Asia, and South America rolled out before my eyes.
I've since thanked my parents -- and apologized to them profusely -- for the amazing opportunities that I took for granted.
When it comes to padding my portfolio's passport with international investments, I'm pretty much the same way. I go in kicking and screaming, fearful of the risks I'm taking on and the costs of bypassing more familiar opportunities closer to home. Yet I ultimately find myself grateful for a chance to be a part of something that I could never see closer to home.
Everyone approaches global investing in different ways. I do so with an aggressive bent. If I'm chasing growth stocks at home, I'm not going to settle for anything less elsewhere. Settling for a foreign blue chip is like hitting up a McDonald's in an exotic country when there's a local favorite eatery next door. If I'm going to take a chance to enhance my returns by diversifying abroad, I may as well load up on octane.
Feed the world
Why look for growth stocks abroad instead of sticking to the States? Growth-stock investing can work even better abroad than it does at home, because gains can be amplified by unsaturated markets and greater growth potential.
I would rather buy into China's Home Inns (Nasdaq: HMIN ) than some sleepy stateside lodging company. Its revenue rose 95% in the first quarter, and it's charging little more than the equivalent of $20 a night for an overnight stay. Rates will inch higher as China's economy continues to grow. Compare that with Morgans (Nasdaq: MHGC ) back home. The chic boutique hotel operator is a speedster by domestic standards, yet it only grew its revenue by 3% in the latest quarter.
Give me China's Sohu (Nasdaq: SOHU ) over domestic laggards like Yahoo! (Nasdaq: YHOO ) in online news. The company had a 156% top-line spike for the first quarter as it expanded into the online gaming business. On the other hand, while I once was a big fan of stateside CNET Networks (Nasdaq: CNET ) , its dismal performance led it to be purchased by CBS.
The growth-stock research service for which I write -- Motley Fool Rule Breakers -- is a great source for building a globally diversified portfolio of fast-growing companies.
Some Rule Breakers picks show just how much growth you can find abroad. Syneron Medical (Nasdaq: ELOS ) , an aesthetic medical treatment company based in Israel, is making waves in skin rejuvenation. If you think vanity is for superficial people, I'll point to an industry in which aesthetic medicines and treatments ring up $25 billion in annual sales.
Baidu.com (Nasdaq: BIDU ) , another Rule Breakers pick, is China's leading search engine. If you think that China's is an overvalued market, keep in mind that just one-10th of the country is online now. The potential is huge.
If you're going to stamp that investing passport, do it with brute force. Kick and scream if you want to. Just remember to take the time to turn down that Walkman/iPod attitude and be grateful for the opportunity to travel.
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