If you haven't yet, it's time for a global rethink of your portfolio

The final analysis GCC equity markets have rebounded just 62 per cent from their all-time lows, compared to 74 per cent for developed markets and 108 per cent for emerging markets. But our global-versus-local view at Emirates NBD is not based solely on returns.

GCC equity markets have rebounded just 62 per cent from their all-time lows, compared to 74 per cent for developed markets and 108 per cent for emerging markets. But our global-versus-local view at Emirates NBD is not based solely on returns. We believe an international approach to investment offers the prospect of far better long-term returns while taking much less risk. It is understandable that you feel comfortable with names and concepts familiar to you when you begin your investment career. The local brand names that surround us in our daily lives are things that we have an immediate affinity with, or at least an opinion about. Mention the name of a UAE bank or property company and most people will have an instant reaction to it, one way or the other.

However, we have also encountered thousands of international brand names, and many of us purchase products made by these names daily. Unfortunately, in our view, many of those same people never consider buying shares of the companies manufacturing those well-knownproducts. Put bluntly, investing solely in the UAE leaves one overexposed to markets that fluctuate more than most others around the world.

On top of that volatility, a portfolio made up of GCC equities alone is invested in only a few sectors, which does not help you in the diversification department. Don't get me wrong: in our view, UAE markets are undervalued, and have excellent long-term prospects. But you don't want to miss out on growth opportunities to be found in other parts of the world. We maintain that the three major global growth sectors are technology, health care and energy. By value, approximately 90 per cent of the technology companies you can invest in are based in the United States. Since the populations of many countries - including the UAE's - are ageing, health care companies will enjoy sustained growth into the future. But neither technology nor health care is even moderately represented in the stock markets of the GCC.

The major growth countries are the so-called BRIC (Brazil, Russia, India and China). Many investors see these places as too risky, but they collectively represent the future of global growth. Even through the credit crisis - Russia aside - they performed far better than the developed world markets. Indeed, it is our opinion that investing in the BRIC markets poses less risk than keeping all of your portfolio in UAE stocks. In addition, returns in those four countries have been much higher than those produced by our regional markets.

Currency fluctuations are a risk that you should always be aware of when investing abroad. Forex markets have been particularly volatile lately, with the US dollar making large gains in the markets. However, the dirham's peg to the US dollar mitigates much of our currency risk, because many developing countries also link their currencies to the dollar. Plus, our global themes of technology, health care and energy are largely denominated in the greenback.

In short, UAE markets may offer good long-term potential, but the smart investor should also look outside the local and think global. Gary Dugan, who is based in Dubai, is the chief investment officer for private banking at Emirates NBD