Investment valuation documentThe creation and composition of an investment portfolio is not an easy task, the investor must ensure that he has both financial stability and profitability. Appropriate asset classes ensure the creation of an effective and profitable portfolio, with subsequent reviews being an option if changes need to be made. A successful portfolio will include both domestic and international market assets in order to improve the portfolio's exposure to risk in each market. In addition to the common investment vehicle, there are alternatives an investor can turn to when their portfolio is not performing as they expected. Furthermore, derivative securities are also useful for improving portfolio performance. This highlights the need for an investor to understand the options before starting to put together their portfolio. International Portfolio Diversification A diversified portfolio is essential for an investor to expose his portfolio to the necessary risk due to differences in characteristics from one asset to another; these activities will be present in both the national and international markets. Fisher (2012) states that “a global portfolio should earn a higher return for the same level of risk and take less risk for the same level of return.” Therefore an investor can achieve risk reduction through international diversification. Some financial experts advise investors to include international assets in their portfolios. In recent years, experts have begun to look into the future of the market and have noticed that there is “a continuation of the long-term trend in the dollar's decline” (Fisher, 2012). This information indicates that the incorporation of international assets within…half of the paper…total liabilities of the portfolio. There are various ways to enter the international investment market, one of these options is derivative securities. An example would be future contracts that will further improve the portfolio. There are other alternative options that can be used to improve the portfolio; It is essential that investors know all their options and use them before assembling the final portfolio composition. As we can see, research is essential for investors before they can fully utilize their portfolio options and successfully create an effective and profitable portfolio. They must call upon all their experience, knowledge, determination and dedication to fully commit to an investment strategy and take their portfolio forward; their goal is to have an excellent portfolio that exceeds optimal levels.