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Health & Fitness

International Investing - Italy

The world is a big place – there are over 190 countries and 7 billion people in the world, which really boggles the mind if you sit down and think about it. In addition to being an interesting intellectual exercise, this fact can also have broad implications for your investments and your financial future. It is easy to stay focused on U.S. firms, news, and events during the day-to-day grind, but it is always important to be aware of your surroundings – especially when it comes to your investments. With that in mind, this series of articles will focus on countries and investment opportunities outside the United States that you might not usually hear about.

As always, be sure to consult a financial services professional familiar with both the potential investment and your unique financial situation before embarking on any investment program.

Italy

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Italy is a very well-known country with a rich cultural history that has traveled with people around the world. Food, music and fashion are all areas where Italy and Italian culture have dominated in the past, and continue to exercise a strong influence. This is known as “soft power,” i.e., the power that comes from a nation’s culture and/or people influencing other people and cultures. Italy, however, is not just food and music. Even with the economic problems that have plagued the Eurozone since 2008, and the specific problems that have occurred in Italy, there are still several reasons that can make Italy an attractive opportunity for an international investor.

One of the most obvious reasons to consider Italy as a place to put your international investment dollars to work is location, location, location. The country itself is located in a crucial junction between Europe, North Africa, and the Middle East, an area that easily contains 800 million potential consumers. Italy’s infrastructure can also provide a powerful reason to invest in the nation. The extensive railroad system, and 2 ports ranked in the top 20 in the Eurozone can certainly be something to consider when looking for a safe and secure place to put your dollars to work. Last, but not certainly not least, are the educational and research institutions present in the nation. Every company needs qualified employees, and the Italian educational and research community certainly can provide that. Companies sell products and services, but it is the people who create them in the first place.

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When looking at investing in Italy, there are two primary ways to go about it – ADRs or direct purchases. An ADR is basically a certificate held by a U.S. banking institution that represents a certain number of shares in the foreign company, and is held by the U.S. institution. This helps to cut down on the administrative fees and other costs that would otherwise be incurred. For more direct exposure, you can also purchase shares directly from Italian stock exchanges if your broker offers those services to its retail investor base (you and me).

Some of the largest Italian firms that are available for investment via ADR include Eni
(oil/natural gas), Gentium (bio-technology), Luxottica (personal goods), and Telecom Italia (fixed line telecommunication). Additionally, for investors looking to invest in Italy via ETF, the iShares MSCI Italy ETF is available.

As always, I have attached some links with more information

Happy Reading!

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