is home country bias detrimental 
naturally people take comfort in the familiar thus it follows that investors select companies they know and trust however investors who do not recognize this bias in themselves may end up with unbalanced portfolios and ignoring one of the cardinal tenets of investing diversification by not diversifying with international securities an investor could create weakness in their portfolio if their home country suffers a serious economic decline or the investor could simply miss out on foreign investment opportunities there are significant diversification benefits to a well constructed international portfolio special considerations for home country biasas with many investing prejudices overcoming home country bias requires thoughtful intention and determined discipline the first step is to recognize it and the second step is to do something about it this is particularly difficult if an investor s home market is the largest equity market in the world and has been singularly rewarding however there are benefits that come with international investing it is a critical ingredient in wealth generation strategies for portfolios with long term investment horizons and can be a fruitful and enlightening adventure 