Latest news with #internationalstocks

Wall Street Journal
a day ago
- Business
- Wall Street Journal
How Much of Your Portfolio Should Be in International Stocks?
After trailing U.S. stock markets since the global financial crisis of 2008-09, overseas stocks have recently begun to outperform. The question for investors: How much of their portfolio should be international? Many investors give this little thought because news coverage tends to focus on the big U.S. indexes like the Dow Jones Industrial Average, the S&P 500 and the Nasdaq composite. What's more, for the past 15 years or so, U.S. investors did better focusing on domestic stocks.
Yahoo
4 days ago
- Business
- Yahoo
Does the Trump Economy Mean Investors Should Look To Invest Overseas?
To say that the global economy has been tumultuous under the first few months of President Donald Trump's second term would be an understatement. The volatile mix of changing tariff policies, high interest rates and geopolitical turmoil has spiked volatility in the domestic and global markets, leaving many investors uncertain where to turn. Read Next: Learn More: With so much uncertainty still in the air — and with the S&P 500 index coming off back-to-back years of 20%-plus gains — some investors have begun looking overseas. But is that a good strategy, for either short-term or long-term investors? Here's an overview of where things stand and what you should consider when making that decision for yourself. Thus far in 2025, investors are clearly speaking with their money — and international stocks have been the way to go. While the S&P 500 has only mustered a modest 5.73% year-to-date gain as of June 30, the MSCI World ex USA Index, the international proxy for the S&P 500, has posted a solid 19.5% return. Over the past year, which includes the final six months of 2024, the S&P 500 did better but still lagged the international index by a 19.3% to 13.33% margin. This indicates that the shift to international equities has occurred almost entirely since Trump has taken office. Find Out: Over a short time frame, nearly any asset class could potentially outperform another. Although a tactical allocation to international stocks may make sense in the current environment for some investors, is it merely a diversification tool in the midst of uncertainty? Or does it make sense for long-term investors as well? Looking at the performance of international stocks over the long run, you can see they generally tend to underperform U.S. markets. Take a look at the data from Dec. 31, 1998, through May 30, 2025, for example. Over that time period, the MSCI World Index ex USA rose from 3,150.46 to 13,393.56, meaning an investment would have more than quadrupled. But the MSCI World Index — which also includes the U.S. — rose from 2,977.02 to 18,250.36, meaning your money would have grown in value by roughly a factor of six. This isn't to say that you should never invest in international stocks. Many advisors recommend a moderate allocation to foreign equities regardless of the current state of the U.S. market for diversification purposes. And international equities have outperformed U.S. markets in the past, and can again. In recent history, for example, markets outside of the U.S. trounced domestic returns for a full decade, from 2001 through 2010. At the end of the day, what's most important is to match your own personal financial objectives and risk tolerance with the appropriate investments. By and large, foreign stocks tend to be more value-oriented, with lower valuations and higher dividend payments. The bulk of U.S. stock market gains in recent history, on the other hand, have been generated by richly priced tech giants. Thus, your own investment style might dictate which markets you would gravitate to. For some investors, a nice blend of international and U.S. stocks might be the ticket. As foreign and domestic markets don't always move in the same direction, the overall effect of a blended portfolio could be a reduction in volatility. With fewer big swings in your portfolio value, you might be more likely to stick with your asset allocation and avoid making emotional decisions — like buying high and selling low. This alone could potentially improve the long-term performance of your overall portfolio. Editor's note on political coverage: GOBankingRates is nonpartisan and strives to cover all aspects of the economy objectively and present balanced reports on politically focused finance stories. You can find more coverage of this topic on More From GOBankingRates These Cars May Seem Expensive, but They Rarely Need Repairs This article originally appeared on Does the Trump Economy Mean Investors Should Look To Invest Overseas?


Bloomberg
22-06-2025
- Business
- Bloomberg
Value Investing Is Getting a MAGA Bump
Value investing has been out of style for over a decade. Even Warren Buffett, who began his career as a deep-value investor, flipped the formula and favored quality businesses. But cheap, unloved companies outside of the US are starting to outperform. Year-to-date, international value stocks beat the S&P 500 by more than 10 percentage points.
Yahoo
18-06-2025
- Business
- Yahoo
Most investors see international stocks beating US peers over the next 5 years, BofA survey shows
Most investors think the US stock market will underperform global stocks over the next five years 54% of fund managers believe international stocks will be the top-performing asset, BofA's latest survey found. Investors see a global recession triggered by tariffs as the largest tail risk for markets. Investors see years of US stock outperformance coming to an end, with most respondents in a survey from Bank of America eyeing international stocks as the top performer in the coming years. Global fund managers surveyed by the bank indicated they felt more optimistic about international stocks than US equities this month. More than half of investors—54%—surveyed from June 6 to June 12 said they believe international equities would be the best-performing asset over the next five years, BofA strategists wrote on Tuesday. That compares to just 23% of investors who think US stocks will be the best-performing asset, and a combined 18% of investors who believed the best-performing asset would be either gold, government bonds, or corporate bonds. The pessimism hanging over US markets appears to stem from President Donald Trump's trade war and concerns about the effects of tariffs on the global economy. 47% of fund managers said they believe a trade war triggering a global recession was the largest "tail risk" to markets. A worldwide recession has been the largest perceived tail risk to markets for three months in a row. Other prominent tail risks investors were eying this month include the Fed hiking interest rates to combat inflation, or a credit event triggered by the "disorderly" rise in bond yields, the bank said. Still, strategists said that investor sentiment had picked up in Bank of America's June survey compared to recent months, and the mood has recovered back to pre-Liberation Day levels. A sentiment gauge that tracks investors' growth expectations, cash level, and allocation to stocks also rose to 5.4 in June, the gauge's highest level since before Trump's April 2 tariff unveiling. "Investor sentiment back to pre-Liberation Day 'Goldilocks bull' levels, but not worrying bullish," strategists wrote. 66% of surveyed investors also said they believe the global economy would avoid a recession and secure a soft landing over the next 12 months, up from 37% of investors who felt that way in BofA's April survey. Read the original article on Business Insider Sign in to access your portfolio