Home Cookin’

24 Aug 2016
It’s often said that people invest with blinders on. This is so true when we look at where people invest their money. This is referred too as “Home Country Bias.” Investor’s natural tendency to invest in domestic stocks and companies. For example US stocks account for 50.9% of global market capitalization, but US investors on average have 79.1% of their equity holdings in American stocks ( Vanguard 12/31/14). It gets worse for other parts of the world:
– Canada represents 3.4% of Global Market Cap yet investors holdings in domestic equities equals 59%
– Australia represents 2.4%  of Global Market  yet investors holdings in domestic equities equals 66.5%
The important part of this study is that these bias’s are not just a United States problem. So, as you are redesigning your portfolio allocations keep in mind your tendency to invest with your heart and not your head.
Good Luck! Jeff

Jeffrey Johnston

Jeffrey is originally from Solon, Iowa. He currently resides in Swisher, Iowa with his wife, Prudence, and his three children, Seth, Ian, and Roman. He graduated from the University of Northern Iowa in 1989, where he majored in Finance and Investments. He has 24 years of experience in the investment and estate planning business. He is currently the President of “Premier Investments of Iowa, Inc.” Jeffrey’s main focus is Estate and Investment Planning for Senior Citizens and Pre Retirees. Jeffrey became a Chartered Financial Consultant (ChFC) in 2001. He is the author of many articles on industry related topics and he is a frequent seminar presenter. He is a Board Member TRIAD Linn County Seniors Against Crime, and he is also a past Board Member of the Heritage Area Agency on Aging Task Force. He is a member of CEO Roundtable in Cedar Rapids, a Daybreak Rotary Member, and a member of the Cedar Rapids Estate Planning Council. In March of 2009, Jeffrey became the host of the Premier Investments of Iowa Financial Hour which airs every Tuesday Evening from 6PM -7PM, on WMT 600 AM Radio. In his free time he enjoys golf, fishing, scuba diving, traveling, and coaching son’s basketball teams.