Many methods exist to help you diversify your overall portfolio. One way to increase your international exposure and participate in profits abroad is through foreign-owned stocks or ADRs (American depositary receipts). In many rapidly growing developing countries, a lack of transparency and a dearth of regulations make it difficult to ensure the legitimacy of companies you're interested in. Furthermore, issues related to trade execution and currency conversion can make the process of purchasing foreign stocks problematic. But buying ADRs of foreign-owned companies that trade on major stock exchanges in U.S. dollars is a good solution. These companies would have had to meet tough listing and transparency standards in order to be accepted onto a major exchange. Therefore, the information you learn about these stocks is probably reliable. (To learn more about ADRs, read ADR Basics: What Is An ADR?.)

Some good companies to consider for international exposure include: Telefonica S.A. (NYSE:TEF), Aluminum Corp. of China (NYSE:ACH) and Suncor Energy (NYSE:SU).

Telefonica Shows Promise
Telefonica looks very attractive from a valuation standpoint. The company has a forward P/E ratio of 9 and a market cap of approximately $103 billion. This is one of the best investment ideas for those seeking exposure to the telecommunications industry in Spain, Europe and Latin America. Over the long-term, it would not be surprising to see profits increase, given Telefonica's sizable market position. For investors interested in long-term international growth, Telefonica is worth a second look.

Aluminum Corp. of China Shines
Whether or not the world cares to admit it, China will continue to be a great long-term growth story, even if the country experiences an eventual slow down in the short-term. Aluminum Corp. of China is a great way to get involved in Chinese expansion. For long-term investors seeking to gain exposure in Chinese growth, this could prove to be a great time to get involved. Shares may be volatile over the short-term, but Aluminum Corp. of China should have future staying power. Smart investors who purchased shares in Aluminum Corp. of China during the period of market weakness should reap future rewards.

Suncor: Attractive Valuation
Shares of Suncor Energy are attractive from a valuation standpoint. The company has a forward P/E of 10 and is trading with a 1.60 price to book ratio. The strengthening oil and gas sector and last year's acquisition of Petro Canada has provided investors a good reason to give this stock a second look.

Bottom Line
For investors who want to diversify their portfolios by participating in the long-term growth some international countries are seeing, ADRs are a liquid, more transparent, and easy way to get involved. However, investing in ADRs requires that you look beyond the current challenges plaguing the world economy. If you are patient and willing to ride out the ups and downs, ADRs are a great way to diversify your overall portfolio long-term. (By investing globally and trading locally, American depositary receipts offer the best of both worlds. To learn more, read ADRs: Invest Offshore Without Leaving Home.)

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