When it comes to explaining to clients the importance of diversifying an investment portfolio in other countries, such as the U.S., sometimes the easiest tactic is to turn the conversation to shopping.

Most Canadians at one point or another have done some cross-border shopping, says Grayson Witcher, portfolio manager, U.S. equity, Mawer Investment Management, in Calgary, and have noticed the difference in prices of various consumer goods, such as TVs.

“I think sometimes people forget when they’re investing that the same is true,” says Witcher, [and] that you need to diversify, otherwise that TV could become even more expensive in Canada.”

Avid cross-border shopping clients may also appreciate the greater selection of companies in the U.S. “You have so many more options [in the U.S. market],” says Witcher, “just because of the size of the economy.” For example, while healthcare is a very small sector in the Canadian market in the U.S. there are a number of stocks to choose from.

Vijay Viswanathan, portfolio manager, large-cap Canadian Equity, Mawer, in Calgary, adds that while the Canadian market provides many opportunities for investors and should by no means be ignored, the size of its economy simply can’t compare to other countries.

“Canada is a great country [with] lots of great companies,” says Viswanathan. “[But] when we factor it into the whole global economy Canada is pretty small compared to other countries.”

Many Canadians may not think twice about travelling to the U.S. in search of a bargain on consumer goods, but when it comes to investing outside Canada clients may be a little hesitant given the economic and market turmoil of 2008 and 2009.

“Some years ago trying to encourage clients to put money in the U.S. was a really tough challenge because of what happened with the financial crisis,” says David Ferrante, vice president, Pembroke Private Wealth Management Ltd. in Montreal. “[And] also because the front page news was always very negative.”

One way to help clients get over this fear and to start diversifying their investments – as they do their shopping sprees – is by talking about more recent market performance. “If you look back at our American portfolios over three or four years,” says Ferrante, “they’ve done a lot better than I think a lot of people [back then] had ever imagined.”

Of course, in looking at past results, particularly the good returns the U.S. market saw in 2013, it’s important to keep client expectations within reason. “We just want to manage expectations,” says Ferrante. “Let people know that we’re very happy that their portfolios have done well but the market never goes up in a straight line, there are some periods of weakness along the way.”