Is Choosing “Local” Stocks a Smart Idea?
Some experts recommend making stock investments in companies near where you live. The underlying rationale is that you will have access to information that allows you to make smarter decisions about when to buy and sell those stocks.
Research shows that is not the case. In fact, a recent study shows that returns on “local” stocks often under-performed the market as a whole. Local investors do not have access to special information. Nor does investing in a local company make that investment safer.
Smart investments are smart investments, wherever the company is located.