A Simpler View
Articles like this frustrate me to no end because they do nothing to try to help readers learn how to explore and assess various investment choices. Morningstar notes the difficulty of "examining the economic and political factors at work in individual countries and trying to use this data to pick winning funds on a consistent basis."
I actually think this is 180 degrees incorrect. Just about every country I have explored as a potential investment has far fewer moving parts than the U.S. market and economy, making them easier to analyze. More often than not, economic strength (relative to the region) can go a long way toward putting the odds in your favor. You guarantee yourself nothing, but look back at my articles on
It's Not What You Use, It's How You Use it
We learned during the tech bubble that owning a search-engine stock, an ISP stock and a B2B stock did not make for good diversification. So it is that a fund from Taiwan, Thailand, Malaysia and Singapore taking up 30% of a portfolio is unlikely to be good diversification either. This would be a valid argument against certain uses of single-country funds, not against the funds themselves.