Chloe Denning, CFP®

International investments provide valuable opportunities for an investor to diversify their portfolio and cast a broader net in the search for returns. Yet many are intimidated by the perceived risk and recent underperformance of investments outside of the United States.

Is an “income investing” strategy right for your portfolio? 

The right answer requires a bit of nuance. While many investors may eventually want to rely on their portfolio for income, doing so does not necessarily require shifting toward income-generating investments.

This Insight explains why. Below, we define income investing, examine some common income-generating investments, and explain why this approach is likely not the best way to maximize total returns.