Sarah, an Australian investor whose portfolio only includes Australian assets (Cash, Australian fixed interest, Australian...

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Finance

  1. Sarah, an Australian investor whose portfolio only includes Australian assets (Cash, Australian fixed interest, Australian listed shares and Australian property) is considering adding international equities in her portfolio.

State:

  1. two advantages of investing in international or foreign equities;
  2. two risks associated with investing in international or foreign equities;
  3. one foreign country in which you would recommend a share investment now, and why: and
  4. one foreign country in which you would not recommend a share investment now, and why.

ANSWER.

  1. In August, 2021, in Australia, Qantas Ltd and Flight Centre Ltd (an airline and a holiday booking company) both announced substantial financial losses for the financial year, 2020-21. Yet on the day of these announcements, the share prices of each company rose by between 3% and 5%. Give two possible reasons for these share price rises.

ANSWER:

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