Definition
International Fund
An international or global fund invests in stocks listed outside India, giving Indian investors exposure to foreign markets like the US, Europe or China.
These funds may invest directly in overseas shares or route money through a feeder structure into a foreign fund. They offer geographic diversification and a hedge against rupee depreciation, since gains are partly currency-driven.
Indian investors should note that SEBI has at times capped overseas investment limits across the industry, causing some funds to pause fresh inflows. For tax, gains are generally treated as non-equity, so holding period and slab-rate rules apply.
Related terms
- Fund of Funds (FoF)A fund of funds invests not in stocks or bonds directly but in units of other mutual funds, including those run by the same or other AMCs.
- DiversificationDiversification is spreading investments across different assets, sectors and geographies so that poor performance in one does not sink your whole portfolio.
- Rupee DepreciationRupee depreciation is a fall in the rupee's value against foreign currencies, especially the US dollar, which makes imports and overseas spending costlier.
Plain-English explainer from The Dispatch Investors Encyclopedia. General information, not financial advice.