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Investing Offshore

At the core of our business is the intention to realise the financial expectations of our clients.

For many people living around the globe, offshore investing has long been an accepted way of life. But the prospect of investing money outside your own country has always been perceived to be a huge challenge - we will attempt to demystify offshore investments.

First of all, don't worry. The main offshore centres are very well regulated and extremely secure. A number of registered investment institutions could advise you on ways to invest in international assets.

Whom to deal with

Often the new investor feels uncomfortable with the idea of placing assets and investments with a foreign organisation whose credentials are unknown and/or using a foreign bank account. With 50 different offshore centres, 126 different legal and tax systems, 27 000 different listed equities and an estimated 36 000 different unit trusts to choose from, where do you invest?

The answer is simple. Stick with people and organisations you know and trust. Few financial institutions can offer you the advantages that Old Mutual International can:

  • wholly-owned international offices and subsidiary companies
  • in-depth experience investing internationally over a number of years
  • monthly portfolio performance reporting, to keep you informed
  • proven results that have consistently outperformed international benchmarks.

Diversifying your portfolio

Investing offshore can help to diversify your portfolio in the following ways:

  • obtain exposure to potentially lucrative growth industries (such as high technology sectors, aerospace, etc. not available locally)
  • make the most of growth cycles and flourishing economies
  • enjoy the advantages of having the world's top investment fund managers working for you (the investment portfolios they manage often run into billions of dollars)
  • protect yourself against a potential depreciation in currency rates
  • build a more secure, safe balanced portfolio in accordance with your financial needs and goals.

Discuss with a financial adviser

Contact your own financial adviser to discuss the possibilities that offshore investments represent.

Factors to consider

Whatever your reason for choosing to invest offshore or internationally, it is important to consider a number of factors:

  • The length of time for which you want to invest. Generally speaking, you should not consider an investment unless you are prepared to lock away your money for a minimum of three to five years. The longer time frame you choose, the lower the level of risk you are placing on your original investment, as short-term peaks and troughs tend to be smoothed out over the longer term.
  • How much money you want to invest, and whether you prefer to deposit a lump sum or to take out a monthly savings plan.
  • Tax implications and banking charges associated with each type of investment will also influence your investment choice. In general, these investments are able to accumulate income and capital gains tax free of local taxes. Taxes on any benefits will depend upon your tax residency and status at that time, but your financial advisor should be in a position to advise you on the applicable tax jurisdictions.
  • The investment costs. Different investment have different fees structures. Ask your financial advisor to explain this to you as well as the impact on your investment.
  • Flexibility. If you anticipate changing your contributions, selling the investment or switching to another investment, ensure the chosen investment can accommodate these changes.
  • Strategy. Are you looking for an investment to form the bedrock of your total investment core portfolio, or are you looking for an exciting peripheral investment with the potential to boost overall returns significantly?
  • Risk. Because most investments are linked to stock and bond markets, the value of your investment can go down as well as up, meaning that investment returns cannot be guaranteed.
  • Diversification is a way to reduce risk. The greater the diversification, the lower the risk, so a world-wide fund is a good place to start. This means that an economic downturn in one country will not necessarily be reflected in others, and so will have a limited effect on the overall performance of your fund.

You are welcome to review any of the products that OMI offers via the remainder of this website.

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