Even (2) has outperformed ex-US very significantly.Since high US valuations are cited as a reason to include international allocation, then I have a question. Is that really a "US vs. International" argument, or more of a "US Big Tech vs. Everything Else" argument?
For example, if we break down US and International as follows:
(1) US Big Tech
(2) US ex-Big Tech
(3) Developed foreign markets
(4) Emerging markets
... then isn't it only (1) that has the valuation issue?
If "yes", then that raises additional questions:
- For the 100% US folks: why wouldn't your reasons for preferring 100% US lead you to preferring 100% US Big Tech? I mean, some of you have said you don't want the laggards, and that's what (2) is.
- For the US/Intl diversified folks: don't (2), (3) and (4) all provide a similar benefit of diversifying way from the overvalued asset class (1)? If the intent is to address the overvaluation problem currently incurred by (1), why isn't adding more of (2) just as reasonable as including (3) and/or (4)? (Of course I know about the "diversification" reason, but valuations were cited as a reason in and of itself, and I'm suggesting that (2) may resolve that particular concern.)
Picking (1) is a very reasonable strategy, and it has proven itself in the long run. Technology has been the ticket over time, and that will naturally continue to be the case.
Statistics: Posted by visualguy — Mon Jul 08, 2024 11:03 pm