Latest news with #AllCountryWorldIndex
CNBC
28-05-2025
- Business
- CNBC
The rest of the world is trouncing the U.S. stock market. Why that could continue
It's been a banner year for international stocks compared to the U.S. The iShares MSCI All Country World Index ex U.S. ETF (ACWX) has rallied more than 14% in 2025, while the S & P 500 is marginally higher year to date. ACWX also hit a closing record high on Tuesday, while the U.S. large-cap benchmark is still 3.8% below its all-time high set in February. This outperformance by the rest of the world is uncommon to say the least. DataTrek Research co-founder Nicholas Colas noted that international stocks are outpacing the S & P 500 by more than three deviations over the past 100 days. That's only the third time that's happened since 2010, he said. These periods have historically been followed by a swift comeback in the S & P 500 relative to the All Country World Index. But Colas thinks this time could be different. ACWX .SPX YTD mountain ACWX vs SPX year to date "We must consider the possibility that there is a regime shift underway in currency and/or equity markets," Colas wrote. "Perhaps capital will keep flowing out of the dollar and U.S. stocks for both diversification and fundamental reasons." The dollar index, which measures the greenback's performance against six leading currencies, has tumbled 8% in 2025. That loss is driven in part by concerns around evolving U.S. trade policies. President Donald Trump in April unveiled a raft of steep tariffs on imported goods. Since then, many of those levies have been temporarily paused or reduced. A lower dollar tends to benefit international markets outside the U.S., making it cheaper for consumers and companies in overseas markets to buy dollar-denominated goods and assets, be they energy or gold or anything else. Stronger oveseas currencies also translate into more dollars when non-U.S. returns are measured here. That tailwind has powered 2025 thus far: iShares MSCI Emerging Markets ETF (EEM): up 10% year to date iShares MSCI Japan ETF (EWJ): up 11.7% in 2025 iShares MSCI China ETF (MCHI): up 15.3% this year "The safest path is to continue to index weight rest of world stocks (roughly a 36% allocation)," Colas added. "While we are still long-term bullish on U.S. equities, investors who benchmark against global equities or those worried about missing out on non-U.S. gains might be well served by owning rest of world stocks for the next few months." Bank of America also pointed out that the technical backdrop for international looks promising. Strategist Paul Ciana noted that ACWX's 50-day moving average is rising and that its 14-week RSI is above 65. "For those reasons, this is a technically constructive picture. Fibonacci measures suggest the breakout can trend higher," he said.
Forbes
28-04-2025
- Business
- Forbes
How Retirement Investment Strategy Impacts Retirement Spending
When it comes to retirement planning, most people know they need to save, but few understand how certain retirement investment strategies can impact the amount of income they'll actually have. In this article, we'll explore four different retirement investment strategies and how each affects your ability to replace 70% of your pre-retirement income: The MSCI ACWI (All Country World Index ) captures large and mid-cap representation across 23 Developed Markets (DM) and 24 Emerging Markets (EM) countries. With 2,558 constituents, the index covers approximately 85% of the global investable equity opportunity set. For a complete description of the index methodology, please see Index methodology. For investment purposes, I use the iShares MSCI ACWI ETF which seeks to track the investment results. The S&P U.S. Aggregate Bond Index is designed to measure the performance of publicly issued U.S. dollar denominated investment-grade debt. The index is part of the S&P Aggregate™ Bond Index family and includes U.S. treasuries, quasi-governments, corporates, taxable municipal bonds, foreign agency, supranational, federal agency, and non-U.S. debentures, covered bonds, and residential mortgage pass-throughs. It has 15,071 constituents. For investment purposes, I use the iShares Core U.S. Aggregate Bond ETF which seeks to track it. Here's the sample case we'll follow: We'll also assume the client will qualify for Social Security benefits, which adjust with inflation. With salary increasing 2.5% per year: Annual retirement contributions: Total future contributions: about $537,000 in future dollars. Using the Social Security Benefits Estimator, this worker could expect about $40,000–$45,000/year starting at full retirement age. Target annual retirement income: 70% of $184,475 = $129,133 (before taxes). Income Sources: Based on these assumed, but not guaranteed, average returns: Here's what each retirement investment mix could grow to by retirement: Retirement investment portfolio mixes Envision Wealth Planning Inc. Note: In the new transition strategy,100% ACWI Pre/60/40 Post, the account grows 100% ACWI until retirement, then rebalances into 60/40 for safer withdrawals. Using a 4% withdrawal* (source: Investopedia): Portfolio strategy and resulting income Envision Wealth Planning Inc. *Note: I am not advocating for 4% withdrawal. It is used here to illustrate the results with that assumption. I advocate working with a designated professional familiar with withdrawal strategies to personalize. Shortfall vs. Goal ($129,133): The 100% ACWI pre-retirement / 60/40 post-retirement approach offers: This helps balance growth and safety, reducing the risk of running out of money later in life. In my Forbes article on maximizing Roth strategies, I discuss similar risk management ideas for building tax-smart, diversified retirement income streams. Even the most aggressive strategy leaves a shortfall. Here's how to fix it: 1. Save More Each Year Boost contributions percentage each year. 2. Delay Retirement Waiting until 70 raises Social Security by about 8% annually. 3. Add Roth Accounts Tax-free income from Roth IRAs and Roth 401(k)s can ease the burden. My article on Roth conversions explains how smart tax moves today can lower taxes later. 4. Adjust Lifestyle Expectations Planning for a 5-10% lower spending target could make a huge difference in retirement security. Retirement investment strategy is a key component of creating future retirement income. Planning for retirement isn't just about picking a number. It's about building a living, breathing strategy that adapts to life's changes. Working with a designated and fiduciary financial planner, such as a Certified Financial Planner, can help you build a personalized plan that keeps growing while protecting what you've worked so hard to build. By using smart retirement investment choices, increasing savings, and planning taxes wisely, you can make sure your retirement isn't just comfortable — it's secure.
Reuters
23-04-2025
- Business
- Reuters
Japan state pension fund switches to foreign benchmark index excluding onshore China shares
LONDON, April 16 (Reuters) - Japan's Government Pension Investment Fund has switched the benchmark it uses for foreign equities for its $1.7 trillion of investments, to one that does not include onshore Chinese shares it said in a recent update. Some global investors have become nervous about owning domestic Chinese shares, known as A-shares, given global trade tensions and China's domestic economic challenges. The Reuters Tariff Watch newsletter is your daily guide to the latest global trade and tariff news. Sign up here. The exclusion of China A-shares is due to the concerns that the pension's investment may be hindered by potential issues including international settlement, market liquidity, restrictions on foreign investors, frequent policy changes and securities transactions suspension, GPIF said in a statement on March 31. GPIF previously used MSCI's All Country World Index (ex Japan) as a benchmark for its investments in foreign equities, but it will use that benchmark also excluding China A shares for the five years from 2025, it said.
Zawya
04-04-2025
- Business
- Zawya
World shares plunged into correction territory as China strikes back in trade war
The main global stock market index fell into 'correction' territory on Friday as China hit back at the sweeping trade tariffs announced by U.S. President Donald Trump this week. MSCI's All Country World Index, which includes 2,645 companies, was down more than 1% on day the after Beijing had said it would put additional tariffs of 34% on all U.S. goods and slap curbs on exports of some key rare earths. The drop was expected to increase when Wall Street trading resumes, futures indicated. But the falls already meant it had lost 10% since hitting a record high in February, a threshold traditionally classed as a 'correction' by market analysts. (Reporting by Marc Jones, editing by Alun John)
