My 2022 Expat Investment Strategy: What’s Working for International Investors

When I packed up my life and moved abroad, I never imagined how much it would shake up my entire investment philosophy. Six months ago, after nervously watching from the sidelines during that crazy first pandemic year, I finally mustered the courage to jump back into the stock market. Now, with 2022 on the horizon, I’ve been doing some serious soul-searching about what’s actually working for those of us investing from foreign shores.

My Core Investment Approach

Here’s the thing – I’ve become a total ETF convert. Forget trying to pick the next Amazon; I’d rather sleep well at night knowing my money’s spread across hundreds of companies. And honestly? The numbers don’t lie. The S&P 500 delivered an impressive 11.91% return in just six months (May to November 2021). Do the math, and that’s knocking on the door of 24% annually. Not too shabby for a “boring” index fund, right?

These days, my portfolio reads like a well-balanced meal – a bit of growth here, some income generation there. I’ve gotten particularly excited about what I call my ‘Lean Muscle’ strategy (yes, I name my investment strategies – don’t judge!). It’s this monthly rebalancing act that leans heavily into QQQ for tech exposure, with a side of TLT to keep things steady when markets get jittery.

High-Yield Income Investments for Expats

Okay, let me share my biggest discovery this year: high-yield covered call ETFs. Game. Changer. Especially when you’re dealing with the constant currency conversion headaches we expats know all too well. These beauties pay out monthly – not quarterly like most dividends – which means predictable cash flow when you’re trying to pay rent in euros or pesos. Here’s what’s been working for me:

• QYLD – This one’s throwing off about 12% annually by selling call options on NASDAQ stocks. It’s like getting paid to own tech without the roller coaster ride
• JEPI – JP Morgan’s offering here gives you some downside cushion with roughly 7% yield. Perfect for when markets get choppy
• XYLD and RYLD – Same concept, different flavors. I like having options (pun intended)

But here’s the kicker that nobody tells you until it’s too late: if you’re not a U.S. citizen and don’t file U.S. taxes, Uncle Sam takes a 30% bite out of those juicy dividends. So that sexy 12% yield? It’s more like 8.4% in your pocket. Still beats a savings account, but definitely something to factor in.

Individual Stock Picks That Worked

Look, I know I just sang the praises of ETFs, but I’m not completely immune to the thrill of picking winners. My individual stock holdings have shrunk considerably, but a few gems have made it worth keeping some skin in the game:

• Airbnb (ABNB) – Talk about timing! This baby jumped from $180 to $210 in a single week as everyone remembered they actually like traveling. I’ve been holding for months and still grinning every time I check my portfolio.
• Iron Mountain (IRM) – I know, I know – a storage company sounds about as exciting as watching paint dry. But that steady 5-6% dividend has been my rock during market tantrums. Sometimes boring is exactly what you need.

I’ve also kept my positions in CarMax (their business model is chef’s kiss), Netflix (because who doesn’t binge-watch abroad?), and some fun sector plays like BJK for casino exposure and MOAT for companies with real competitive moats.

The Property vs. Stocks Debate

Let me settle this age-old debate with some real numbers from my own portfolio. Since 2018, my stocks have returned about 26% total (roughly 8% per year), while my rental properties chug along at 5-6% yields. But here’s what the numbers don’t tell you:

• Stocks = instant liquidity. When you’re 8,000 miles from home and need emergency cash, you can’t exactly sell a bathroom
• Property = stable income but oh, the tenant drama! Nothing like getting WhatsApp messages about broken toilets at 3 AM in your new time zone
• Stock dividends = truly passive income. I’m pulling in about $40,000 annually just from dividends, and I don’t have to fix anyone’s leaky faucet

Lessons for Expat Investors in 2022

After fumbling through years of international investing (and making plenty of mistakes along the way), here’s what I wish someone had told me on day one:

ETFs are your best friend when you’re dealing with wonky time zones. Trust me, trying to day-trade U.S. stocks from Asia is a recipe for exhaustion and poor decisions. Set it and forget it has never been more relevant.

Income investing hits different as an expat. Those monthly dividend payments from covered call ETFs? They’re like a financial security blanket when you’re navigating currency swings and unexpected visa fees.

That tax withholding thing I mentioned? It’s real, and it hurts. Build it into your calculations from the start, not after you’ve already mentally spent that 12% yield.

And perhaps most importantly – this isn’t gambling. I’ve become almost evangelical about buy-and-hold investing in quality companies. Real businesses making real products for real customers create actual wealth. It’s not magic; it’s just capitalism doing its thing.

Looking Forward

As I map out my 2022 strategy from my apartment overlooking [insert beautiful foreign city here], I’m doubling down on what’s working: a solid foundation of diversified ETFs, those lovely monthly dividend payers, and a carefully curated selection of individual stocks in businesses I actually understand.

Here’s the bottom line – being an expat doesn’t mean you have to sit on the sidelines watching everyone else build wealth. Yes, we face unique challenges (hello, FATCA forms!), but with some thoughtful planning and the right mix of investments, you can absolutely thrive financially while living your best international life. The world is your oyster, and your portfolio can be too.