So the question is: is there any compelling or even remotely plausible reason that one can use to justify a 100% stock allocation to the United States only?
That doesn't address the question of the lower end. In other statements I don't have exact quotations for, he's said that he thinks 0% is fine, but if you want some international up to 20% is fine--but he actually recommends against more than that.I want to reemphasize my reluctance to enbrace the idea of holding a true global portfolio, in which a U.S. investor's market weighting would be based on the weights of the markets of each major nation, resulting, in mid-2009, in 44% U. S. stocks and 56% international stocks. But I have no reluctance whatsoever to emphasize a truly global strategy, focussed largely on U. S. stocks.
Calm Man wrote:So the question is: is there any compelling or even remotely plausible reason that one can use to justify a 100% stock allocation to the United States only?
The question should be, "Why not diversify internationally?"
Simplegift wrote:The question should be, "Why not diversify internationally?"
Taylor Larimore wrote:The question should be, "Why not diversify internationally?"
The answer may be found on pages 251-276 in Common Sense on Mutual Funds.
John Bogle, in Common Sense on Mutual Funds wrote:The moral of the story is clear and simple: Stay home and dig your own garden, instead of tempting fate in an alien world. You will find "acres of diamonds" right where you are.
The more I read about investing outside the United States, the more I think about this story. I am not suggesting that the U.S. economy is a new Golconda, nor that investing in overseas ventures is parallel to death in a foreign land. But here in the United States we have, at least for the moment, the most productive economy, the greatest innovation, the most hospitable legal environment, and the finest capital markets on the globe. With 5 percent of the world's population, we produce 25 percent of its goods and services. It is safe to say that the United States is the envy of almost every other nation. As U.S. citizens, we should count our blessings every day.
If our diamond lode is within our own borders, shouldn't the investments we choose for our portfolios stay here, too? I believe that would be a sensible strategy. Overseas investments — holdings in the corporations of other nations — are not essential, or even necessary, to a well-diversified portfolio.
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