Lately, we’ve been getting a lot of questions about international investing—and to be fair, that’s largely because it hasn’t performed as well as U.S. stocks in recent years. So, does that mean you should ignore international markets? Not at all.

Let’s break down why having international exposure in your portfolio still makes sense and what role it can play in your overall investment strategy.

Key Takeaways:

• International markets are categorized into three main types: Developed Markets (DMs), Emerging Markets (EMs), and Frontier Markets.
• Developed markets include companies like Nestlé, Mercedes, and Airbus—large, established firms in stable economies.
• Emerging markets include Brazil, India, and China—economies with high growth potential but more volatility.
• Frontier markets are even less developed, with higher risk and instability, so we typically avoid them.
• While international stocks have underperformed U.S. stocks for the past decade, they are currently offering compelling value for long-term investors.

Why Include International Stocks in Your Portfolio?

Even though international stocks have lagged behind U.S. stocks for the past 10 years, there will come a time when they outperform again. The challenge is no one knows exactly when. That’s why diversification matters—ensuring you have exposure to different markets so you’re not caught off guard when trends shift.

• More aggressive investors may lean toward emerging markets for growth opportunities.
• More conservative investors will likely focus on developed markets for stability.

Bottom Line

No one can predict exactly when international markets will outperform U.S. stocks, but history tells us it will happen at some point. That’s why maintaining some international exposure—whether in developed or emerging markets—is a smart strategy.

If you have questions about how global markets fit into your portfolio, let’s talk. We're here to help you build a balanced, diversified investment strategy that aligns with your goals.