Diversification and valuation versus the deepest, most innovative, historically outperforming market. Most investors hold both.
International and US stocks are not an either/or for most investors. US stocks offer the deepest, most innovative market with strong historical outperformance. International stocks offer diversification, often lower valuations, and exposure to different economies and currencies, and they can lead in particular cycles. The question is core versus diversifier.
| International Stocks | US Stocks | |
|---|---|---|
| Market depth | Varies by region | Deepest |
| Historical returns | Lower recently | Strong outperformance |
| Valuations | Often lower | Often higher |
| Diversification | High | Concentrated in US |
| Currency exposure | Yes | Home currency (USD) |
| Best for | Diversification, value | Core, innovation |
US stocks are the deepest, most innovative market with strong historical outperformance, making them the core for most portfolios; international stocks add diversification, often lower valuations, and currency exposure, and can lead in certain cycles. Most investors hold both - US as the core, international as the diversifier.
The mistake is going all-in on recent US outperformance and ignoring diversification - leadership rotates across cycles.
The scanner weighs both sides on the factors that actually drive value, and the Vault tracks specific assets over time.
Most investors hold both - US stocks offer the deepest, most innovative market with strong historical outperformance, making them the core, while international stocks add diversification, often lower valuations, and currency exposure. The right balance depends on your goals, but holding both is common. This is research framing, not financial advice.
US stocks have outperformed international markets over recent periods, driven by depth and innovation, but leadership rotates across cycles and international markets can outperform during certain periods. Diversification across both is common precisely because future leadership is uncertain.
International stocks provide diversification, exposure to different economies and currencies, and often lower valuations, which can cushion periods when US stocks underperform. Because market leadership rotates over time, holding both reduces reliance on a single market’s continued outperformance.