Category: offshore investing

Consider these tiny tropical paradises when investing in offshore mutual funds

Many offshore financial centers have been dependable jurisdictions for international financial investors as well as commercial and corporate entities.  Within the industry, there are regions that have become the top go-to locations that offer generous benefits like financial privacy and tax liability. Some perfect examples are the islands in and near the Caribbean region: Cayman Islands, Bahamas, and Bermuda.

The Cayman Islands

Image source: worldpropertyjournal.com

Image source: worldpropertyjournal.com

Located in the western Caribbean Sea, this offshore financial center has been considered as one of the largest in the world. It primarily provides its Western clients services like offshore mutual funds and offshore banking. What makes the islands so attractive to investors and companies is the fact that it does not impose income tax, estate or inheritance tax, corporate tax, or capital gains tax, to name a few. Cayman’s highly strict banking laws protect banking privacy and they do not have any tax treaties with other countries.

The Bahamas

Image source: cntraveler.com

Image source: cntraveler.com

Located just a few hundred kilometers away from mainland USA, the island-country of the Bahamas is one of the most prosperous and richest countries in the Caribbean region.  Its government has been actively promoting programs to attract offshore businesses to its islands. Aside from the fact that the country is a popular tourist destination among European and American travelers, the nation’s well-designed tax laws as well as tax regulations particularly on asset protection, have been attractive characteristics for non-resident investors and commercial businesses.  In addition, the Bahamas boasts of an open economy, with their currency, the Bahamian dollar, pegged to the U.S. dollar.

Bermuda

Image source: bermudianlife.com

Image source: bermudianlife.com

This wealthy Atlantic paradise has two main attractions: first, it is home to one of the world’s biggest reinsurance centers and second, it has made its name as one of the most dependable offshore centers on insurance-related securities and offshore mutual funds. Although geographically nearer to the Caribbean, Bermuda is actually a part of the British North America, located in the Sargasso Sea. One of the world’s most trusted offshore financial services firms, LOM Financial, is headquartered right at the heart of this British Overseas Territory (BOT) in Hamilton, with offices in the two aforementioned jurisdictions.

To know more about offshore mutual funds, click HERE.

Offshore Investing – Why, What & How

Offshore investing is a concept that is gaining popularity especially with the elite business class individuals who have investments in different countries across the globe. This simply means putting up your money in bank accounts in other countries that have different jurisdictions from where you reside. Foreign investments have in the past been an expensive affair because it involved the transfer of assets from one country to another. With the introduction of offshore investments however, it has become easier since the investor is only required to have an offshore bank account to facilitate international money transfers.

One of the main reasons why offshore investing is a preferred option is because of the fact that it encourages investment diversification. Most nations have set up strict rules which hinder or slow down international investments claiming that it is an obstacle local investments and the end result is slowed down economic growth. While such restrictions are beneficial to the government, they do not add much value to individual investors.

Investors understand the importance of investment portfolio diversification, and the best of this is one which includes international investments. Offshore Investing accounts therefore offer this opportunity by providing a flexible platform where one can invest their assets in a different country without having to go through a lot of legislative hustles. In addition to this, the investor is able to gain access to different major currency exchanges.

Offshore investing has also enabled investors to gain access to the developing countries most of which are undergoing the process of privatizing their once state owned organizations. In such cases, both these governments and the international investors benefit. The governments are able to raise money for their development projects from the privatization process while investors get the opportunity to diversify their portfolios.

The other reason why offshore investing is preferred by many investors despite its high maintenance cost is the fact that security and confidentiality are guaranteed. Offshore bank accounts are the most confidential accounts owing to the sensitive nature of most investors’ financial status. Most of these investors are the multimillionaires who prefer to remain anonymous for security purposes and also to ensure that the stocks they invest in do not get flooded by the small scale investors who are famous for initiating price run ups.

In conclusion, offshore investing is the best option for large scale investors who have the capacity to invest at international levels. Developing countries especially in Asia and Africa have been the biggest beneficiaries of offshore investing with the best example being China whose privatization process has attracted a lot of international investors, and this explains the growth in export of consumer goods.

For more info check out the links below from lom or watch the video underneath:

lom.com/mutual-funds
lom.com/investment-brokerage-services