The U.S. market is great, but it\'s only 60% of global stocks. Here\'s the case for going global.
The U.S. stock market is the world's largest and most dynamic, but it represents approximately 60% of global market capitalization. Excluding the other 40% — companies in Europe, Asia, emerging markets, and elsewhere — concentrates your portfolio significantly in a single country's economic performance.
The U.S. has been the clear winner over the past 15 years — but history is longer than the last 15 years. From 2000 to 2009, international developed market stocks significantly outperformed U.S. stocks. From 2003 to 2007, emerging market stocks dramatically outperformed. No single country or region dominates forever.
The market-cap weighted approach (matching global market proportions) would suggest roughly 40% international. Many U.S. investors choose 20–30% international — enough to achieve meaningful diversification while maintaining a home-country tilt. The exact percentage matters less than maintaining it consistently.
Some respected investors, including Warren Buffett, argue that large U.S. companies like Apple, Microsoft, and Amazon already generate substantial international revenue — providing de facto global diversification. This is a legitimate perspective, though academic consensus generally favors explicit international allocation.