Characteristics of Stocks

Domestic vs International Firms

Domestic firms only operate in their home country, while international firms operate in multiple countries. Whether a company is domestic or international can affect the performance of its stock price.

Companies that operate globally are less likely to be affected by events within a single country. Therefore, if something significant happens politically in one country, a global company will be less affected by it.

On the other hand, domestic firms are exposed to country-specific risks, which means that their business can be damaged by an event that takes place within that country (i.e. political unrest).

Global firms operate with multiple different currencies too, which means that they are less likely to be impacted upon by the strengthening or weakening of a particular currency.

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