6 – L2 05 International ETFs V2

Investing internationally is easier with ETFs. Normally, if you wanted to trade stocks in another country, you might set up a brokerage account with a firm in that country. Also, you would be trading when markets are open in that country’s Stock Exchange, which is tough if the time zones are different from yours. For example, let’s say you are in New York and making trading decisions for shares in Tencent or China Construction Bank which are listed in the Hong Kong Stock Exchange. Since the time zones are far apart, you would be spending your late evenings until early mornings managing your trades. What if you like having a regular sleep schedule as well as a social life? Well, financial firms create ETFs for international stocks and sell these ETF shares in the local US Stock Exchange. For example, BlackRock issues the iShares China Large-Cap ETF, which is called FXI for short. The FXI tracks the 50 largest stocks that are traded in the Hong Kong Stock Exchange, including Tencent and China Construction Bank. So, you can trade at the FXI on the New York Stock Exchange during the day, then at night you can get some well-deserved sleep or party with your friends.

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