Wil:
I clearly do believe that EAFE & EM will outperform the US market in the next 5-10 years. I think relative valuations justify this and I'm willing to live with the increased volatility. I do not believe that the tax environment in the US will fundamentally change to make up for the differences in valuation.
I'm personally very willing to adjust my portfolio allocations to take advantage of macro level trends. For example, in early 2015 I intentionally added an allocation to Energy after it cratered. In that case, when I rebalanced early this year, I took the 25% gain off the table and basically eliminated that 'extra' allocation, falling back to just a normal allocation to energy in my normal equity index allocation.
*shrug* If I'm wrong, you can laugh at me for gambling.
To the discussion about returns of asset classes...some examples of long term projected return thinking are here:
https://www.bogleheads.org/wiki/Hist...pected_returns
You can also google 'expected returns by asset class' and get a ton of white papers put out by different companies...Vanguard, Blackrock, JP Morgan, etc. providing their view on asset classes. These are updated, so you can find very current thoughts. Obviously, these are somewhat throwing darts, but there's a reason there's a lot of general consensus....because we have alot of historical data on asset classes (return & volatility) to look at.
Also, if you aren't familiar with it, I love the periodic table of investing. Several folks put these out with different asset classes broken out. They are pretty interesting to illustrate the advantages of diversification.
Last edited by jalexand42; 02-15-2017 at 03:50 PM.