<p>To guard the portfolio against currency depreciation one should invest in global funds.</p>
The argument to invest in global funds is an extension of the basic tenets of investing, which calls for diversification— spreading of money across asset classes and geographies. Another advantage is that you can guard your portfolio against currency depreciation. Moreover, different markets fare differently at different times.
Investing in international funds is tricky because each fund is radically different from the other in its investment mandate and composition. Given such complexities, investments in these funds are for investors who have a well-diversified portfolio in Indian markets and those who can understand the risks associated with such complexities.