Bibliography suggests many ways with which risk can be predicted or/and be minimized. Initially, diversification of a portfolio was first proposed as an idea by Markowitz (1952), who described how to combine assets into efficiently diversified portfolios. He demonstrated that investors failed to account correctly for the high correlation among security returns. Diversification, he concluded “reduces risk only when assets are combined whose prices move inversely, or at different times, in relation to each other”. Modern portfolio theory constitutes the basis of this concept that is diversification reduces risk. This paper aims to analyze critically fundamental methods with which risk and returns of emerging market investments can be found and measured as well as if risk, discount rates, and transaction costs can be reduced for international diversified investments.