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The information below seems to show that those who are invested in international markets will benefit from the devaluation of the dollar as they have this year. The reason is as the value of international currencies increase relative to the US dollar investments in international holdings increase in value even without future earnings from their sales.
https://www.morningstar.com/markets/will-dollar-keep-falling?utm_source=eloqua&utm_medium=email&utm_campaign=MorningDigest&utm_content=None_68062&utm_id=35352
In the first half of 2025, the US dollar saw its steepest decline in over five decades. The DXY index—which tracks the dollar against major trading partners—fell about 11% from January to June. In our view, the US dollar remains overvalued, and its underlying fundamentals are beginning to weaken.
In our view, the “free lunch” period for the dollar may be ending, with depreciation likely in the years ahead as US economic exceptionalism fades.
Morgan Stanley Research estimates the U.S. currency could lose another 10% by the end of 2026.
A Blackrock article from July reports U.S. equity markets were trounced by their international counterparts in one
Here is the rest of the sentence, sorry for the omission of below
of the largest performance gaps in decades.
Very interesting observation, David. Dollar depreciation really highlights the currency translation effect many overlook—international holdings can deliver gains even before fundamentals kick in. That said, it’s also a reminder that currency exposure cuts both ways; periods of USD strength can quickly reverse those tailwinds. For long-term investors, strategic international diversification (ideally with some hedging considerations) seems increasingly important, especially if the structural dollar decline narrative plays out.
This year was the first in many that I was happy to be an International investor.
This website usually argues against market timing. The premise of this article is market timing.
It’s also a case of, here’s more information, let’s react.
Somebody already posted a link to an article about international index stock investing, which is the solution to the problem. What is your allocation in foreign stocks? Do you want to increase it?
The premise of the article was for people to consider international stocks as part of a diversified portfolio. That is not necessarily market timing, but diversifying.
As for my equity allocation it is 30% domestic/15 international about the allocation of world index fund/ETF ie 2/3 US/1/3 international. The balance of my portfolio at 68 years old is 45% bonds about evenly split between a total bond ETF, short term, and short term TIPS ETF and 10% cash..