I tend to think 50% is high myself. 30% is enough to reduce volatility:
"In a March 2012 research report, Vanguard reviewed historical results and found for investors who have equity targets of at least 60% of the total portfolio, that an allocation of the stock portion of your portfolio of between 30-40% international stocks provided the most benefit as far as reducing volatility."
The Vanguard target retirement date funds are ~ 35% international equity.
Many of the biggest US companies derive a lot of their revenue from outside the US, which also leads me to lower my international allocation lower then would be suggested by a pure market cap allocation (45% US, 55% international).
The fact that international has underperformed the US market the last 9 years is not really a reason to eliminate international from your asset allocation. We diversify for a reason, to smooth returns and (hopefully) reduce risk. If we want max returns, we should just go %100 US small cap and be done with it, right? As the sector rotation chart:
https://novelinvestor.com/asset-class-returns/
shows, you never know which asset class is going to out perform. Spread it out and stick with it.
Edit: Just noticed Brian also linked the annual returns by sector.
"The Callan Periodic Table of Investment Returns conveys the strong case for diversification across asset classes (stocks vs. bonds), investment styles (growth vs. value), capitalizations (large vs. small), and equity markets (U.S. vs. non-U.S.). The Table highlights the uncertainty inherent in all capital markets. Rankings change every year."
Last edited by unfrgvn; 01-25-2017 at 11:13 AM.
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