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Health & Fitness

International Investing - The Netherlands

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.

The Netherlands

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The Netherlands might not be one of the first countries that comes to mind when investors are thinking about global economies or large corporations, and that is an inaccurate mindset. The Dutch East India Company is often considered to be the first multinational corporation. As one of the largest economies in the world, and an economy that weathered the global recession relatively well, the Netherlands is positioning itself to attract foreign investment dollars.

The Netherlands has a long history, as evidenced by the history of multinationals created and headquartered there and of its supportive policies for business. These accommodative policies have resulted in several very large multinationals (more below) worthy of investor consideration. Large energy and manufacturing sectors in the economy provide two of the major underpinnings of the Dutch economy. As a member of the EU, the Netherlands and the firms that are headquartered there have access to the EU market, which is the largest economic marketplace in the world.

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When looking at investing in the Netherlands, 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 Dutch stock exchanges if your broker offers those services to its retail investor base (you and me).

Several of the largest Dutch firms that are available for investment are Royal Dutch Shell, the ING Group, Unilever, Philips, Heineken and Ahold. This cross-section of the corporate profiles is an excellent representation of the corporate export profile that the nation has created as a result of the favorable policies. One of the most popular Netherlands ETF is the iShares MSCI Netherlands ETF.

As always, I have attached some links with more information

Happy Reading!

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