I think I see your point.
1. There's a strong US home bias and investors overpay because of it (higher valuations you mentioned).
2. Non-US companies selling within their own countries are materially different than US foreign sales, adding to diversification.
Follow-up question:
If you have the S&P with 41% foreign sales, and you add the market weight of 38% International; does that make you overweight in International?
I'm a believer in international diversification. But my question is:
41% of sales in the SP 500 are from foreign sales.
How does affect your thought process in determining allocation to international markets?
It's unfortunate that the 401K loan limit is still at $50K, same as it was at least since 1996. The 1996 loan would be about $94K in 2022 dollars. It seems like limits intended to help the individual investor are not adjusted for inflation. The ability to deduct $3k capital losses on income is another example. It hasn't changed for decades as far as I know. The AMT limits (pre-Trump tax law change) is another example. However, the payroll taxes are adjusted reliably every year.
If the investor pays, it's adjusted reliably. If its something the investor might gain from, its ignored.
Comments
I think I see your point. 1. There's a strong US home bias and investors overpay because of it (higher valuations you mentioned). 2. Non-US companies selling within their own countries are materially different than US foreign sales, adding to diversification. Follow-up question: If you have the S&P with 41% foreign sales, and you add the market weight of 38% International; does that make you overweight in International?
Post: Not Scared of Bears
Link to comment from April 28, 2024
I'm a believer in international diversification. But my question is: 41% of sales in the SP 500 are from foreign sales. How does affect your thought process in determining allocation to international markets?
Post: Not Scared of Bears
Link to comment from April 28, 2024
It's unfortunate that the 401K loan limit is still at $50K, same as it was at least since 1996. The 1996 loan would be about $94K in 2022 dollars. It seems like limits intended to help the individual investor are not adjusted for inflation. The ability to deduct $3k capital losses on income is another example. It hasn't changed for decades as far as I know. The AMT limits (pre-Trump tax law change) is another example. However, the payroll taxes are adjusted reliably every year. If the investor pays, it's adjusted reliably. If its something the investor might gain from, its ignored.
Post: This Old House
Link to comment from September 1, 2022