According to Goldman Sachs, stocks with sales exposure to the U.S. have outperformed stocks with exposure to other regions of the world since the beginning of 2008. Don’t count the U.S. out, else you could underperform:
BRICs-and-emerging markets-exposed stocks underperformed massively during the height of the financial crisis, even though America was the focal point of the crisis. Since then, emerging markets-exposed stocks have come back relative to U.S.-exposed stocks. But keep in mind that this was during 2009, a year when emerging markets stocks were loved by the average American investor based on fund flows, while U.S. stocks were shunned.
If fund flows simply normalize, U.S. stocks could start outperforming their emerging markets peers again.
Europe-exposed stocks meanwhile, have a long way to catch up.
(Via Goldman Sachs, GS Weekly Handbook, 15 February 2010)
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