gt4715b wrote:Most people that have more than 50% international allocation do it because they believe in having their portfolio match the global equity market capitalization. Right now the US is about 44% of the global market cap, thus a person doing this would have a 56% international allocation. For more details look at the Vanguard ETF VT. This is usually considered the maximum recommended international allocation.
This is discussed widely in many other threads.
livesoft wrote:The polls could be giving you a false impression. As an example, I want nominally 50% international, but because international has done well I actually have slightly more than 50% of equities in international. If the poll has an option "more than 50%", then I have to choose that and I fall into that 10% category that you mentioned.
I will go out on a limb and guess that a significant fraction of the folks with more than 50% international actually do not live in the US. Another fraction is probably really nominally 50%.
That doesn't leave many others to explain their reasons.
z3r0c00l wrote:The reasoning for me is as follows...
Firstly, I attempt to own the market as I have been convinced by experts that it is the most efficient way to invest. So owning the market gives me a bit more than 50% intl (presuming you mean of equity holdings.)
Another almost equally important factor is diversification. We all tend to agree that it is not smart to own a huge amount of company stock; if the company goes under, you are both out of a job, and your investments tank. Although I think the United States is more stable than any single company, I know that a severe economic downturn like a depression would possibly put me out of work. In the unlikely but possible event that a depression here is not as bad elsewhere, say in Russia, India, China, I want some of my money there.
Less damaging but more likely is the possibility that the United States will fall behind the rest of the world in growth at some point, perhaps for decades, possibly for the rest of my life. Either the US will do better, worse, or the same as the rest of the world. I have no plans to pick the lucky region and beat the world market, instead I plan on matching the world market. When it comes to investing, I want the sure thing. And the only sure thing is that you can match the market and be content with it.
Also, not for nothing, I like to own spicy things like emerging markets and NICs. I am convinced that they are likely to do well in the future, at great risk to investors and possibly great reward. I would not own them above their market share, but would worry about not taking some exposure to them also. Missing out on small parts of the world market could mean missing out on a significant amount of growth.
Nathan Drake wrote:I tilt more towards intl due to market cap and the fact that intl is attractively valued right now.
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