Don’t put all your eggs in one basket. Diversification is a smart strategy for every investor.

In 1954, the founding father of overseas investing, Sir John Templeton, had a big idea: look beyond America’s borders for investing riches.

This wasn’t exactly common at the time. After graduating from Yale, he was amazed that Americans hardly ever invested abroad. For a long time, he recounted, it was almost considered unpatriotic for an American to buy foreign securities.

Over the next 50 years, Templeton amassed a small fortune by investing in overseas markets – eventually becoming a billionaire.

And his Templeton Mutual Funds (now the Franklin Templeton Funds) produced an annualized return of 13.8% (compared to just 11.1% on the S&P), causing Money magazine to dub him “arguably the greatest global stock picker of the century.”

So how’d he do it?

Templeton considered himself a “bargain hunter.” Always a contrarian, he looked for “companies around the world that offered low prices and an excellent long-term outlook.”

Templeton lived by a set of 16 rules. If you want to have international investing success, you’d be smart to follow these rules, too…

1) Invest for maximum total real return
Always remember taxes and inflation when you’re looking at investing returns. These fees add up. So smart investors plan ahead to protect their investments.

2) Invest—don’t trade or speculate
Don’t think of investing as short-term gambling. Rather, patiently invest for the long haul to avoid seeing your profits eaten up by broker commissions and other emotion driven mistakes.

3) Remain flexible and open minded about types of investments
Don’t get hung up on just stocks or bonds. Many different types of investment vehicles are available. And each could have a place in your portfolio given the right circumstances. Exchange-traded funds (ETFs) weren’t around in Templeton’s day. But these are great, low-cost ways of investing in overseas markets.

4) Buy low
Easier said than done. This is bedrock of Templeton’s investing success. He believed you should “invest at the point of maximum pessimism.” This is when an investment was dirt-cheap and no one wanted it.

5) Search for bargains among quality stocks
It’s not enough to just buy cheap stocks. You need to buy cheap quality stocks. According to Templeton, “Quality is a company strongly entrenched as the sales leader in a growing market. Quality is a company that’s the technological leader in a field that depends on technical innovation. Quality is a strong management team with a proven track record. Quality is a well-capitalized company that is among the first into a new market. Quality is a well-known trusted brand for a high-profit-margin consumer product.”

6) Buy value—not market trends or economic outlook
Templeton believed in the principles of value investing. This means always looking for stocks or ETFs that are “out of favor” with the market. A good way to spot value is to look for stocks—or stock markets­—with low P/E ratios.

7) Always diversify
You’ve probably heard this before, but don’t put all your eggs in one basket. Diversification is a smart strategy for every investor.

8) Do your homework
Before you place a single dollar in the market, it’s absolutely necessary you investigate thoroughly. Make sure you understand the macro forces acting on your investments. Pour over company balance sheets. Read shareholder letters. Understand exactly what a company does and what’s made it so successful in the past. If you don’t understand what you’re investing in—don’t invest!

For the remaining eight Templeton tips, check back on Friday.