ADRs represent an ideal opportunity today for US investors to gain access to international markets such as the UK, which has been enjoying a surprising market rebound since Brexit, the FTSE 100 having exceeded 6,800.
“There are a large number of developed and developing market companies that list ADRs across the capitalization spectrum; small cap through to large cap. It’s a wide dispersion of companies that do ADR listings.
“Investors in the US, as well as those in Europe and Asia, have a home country bias when it comes to investing so getting international exposure, in general, is a good thing for investors to consider. Also, the US dollar has stopped heading northwards – when it was rising, of course the US stock markets were the only game in town for US investors as international markets underperformed on a relative basis.
“But the US dollar has started to slow slightly and international markets to perform better. I think as the US dollar flattens out, international investments are going to look much more attractive to US investors,” remarks Lewis.
To take full advantage of the opportunities on offer, DWA utilizes a smart beta strategy by focusing exclusively on momentum and trend so as to provide investors with a viable route to holding foreign stocks without the operational headaches associated with buying stocks on international exchanges.