Another benefit of international investment is the potential for higher returns. The correlation between domestic and foreign investments is low. Diversification is best achieved by combining assets with negative or low correlations. Combining assets that are highly correlated does not reduce risk. Warning! The research suggests that global diversification must be done carefully, considering regional factors. For example, the Canadian stock markets are highly correlated to the U.S. markets which means that combining U.S. stocks and Canadian stocks results in a minimal reduction of risk, unless a very careful analysis is performed.