Seeking Alpha

The Asset Allocator: An Idiosyncratic Approach To Foreign Investing (Podcast)

by: SA For FAs
SA For FAs
Senior Editor, FA Content
Summary

The home bias of U.S. investors has a logic to it, apart from the past decade’s extraordinary outperformance of U.S. stocks.

The U.S. possesses a rare combination of political and economic stability plus entrepreneurial dynamism, so Americans are apt to look at the world and see risks more vividly than others.

“Buy Europe,” of “Buy Emerging Markets” can thus sound unappealing, as the former does not connote growth and the latter does not connote stability.

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The home bias of U.S. investors has a certain logic to it, apart from the past decade’s extraordinary outperformance of U.S. stocks.

This podcast (6:57) suggests that investors should globally diversify, but qualitatively, on a country-by-country basis, which the plethora of country ETFs today facilitates. Furthermore, value opportunities (like the recent plunge in Chile’s market) can guide us on timing.