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As many firms and advisors are now focusing more on Foreign market emphasis I am curious what others have allocated. We have generally been 47-50% domestic equity, 38-35% foreign equity, including about 5%+ in Emerging Markets and the remaining 15% in bonds for the past 5 years. The higher foreign exposure was a little drag in the past however is boosting returns currently.
Curious of others opinion on international is, we don’t make big swings but stay within a general range. We are moving more toward a 20% bond allocation while reducing large cap domestic equities to 42-45%
thanks everyone.
I have had 30% of my equities in international stock for the last ten years. Jack Bogle went 100% US, while Vanguard Target Retirement funds have 40% international, and I go in between the two.
28% of S&P 500 revenue comes from non-US sources. Jack Bogle said not to bother with non-US equities but offered non-US funds anyway. I have 5% in emerging market equities and 15% in EAFE equities for diversification. BTW, much of the non-US outperformance in 2025 was due to dollar depreciation. Also, there are some great non-US companies and the dividend yield is triple the S&P 500.
We have 39% of our stock portfolio in international/emerging markets. Stocks make up 56% of the total so international is about 22% of our total portfolio. This allocation has underperformed in recent years until 2025. The expectation is that the international exposure will smooth out the ride rather than increase overall returns.
Recently shifted from 80% domestic 20% international to 70% domestic 30% international for equities. Reasons were the relatively high cost of US equities and top heavy nature as others have noted.
Investing from the UK means 95% of my portfolio is already in foreign markets. Right now, I’m focused on rotating out of the expensive US market and into European and Southeast Asian markets instead. Once I’ve shifted enough to bring my Big Seven concentration down to 15% of my equity portfolio, I’ll be satisfied.
International boosted my returns. International is 26.4% of my stock portfolio. However, I have not made a significant change to my portfolio since 2021.
Here’s a timely Morningstar article on the subject by Allan Roth: https://www.morningstar.com/markets/why-international-stocks-still-matter-diversifying-beyond-us-winners-2026?utm_medium=referral&utm_campaign=linkshare&utm_source=link
Some interesting gems in the article:
“By my calculations, using data from CompaniesMarketCap.com, the 10 most valuable companies (largely tech) accounted for nearly 36% of the total value of the entire US stock market as of Dec. 31, 2025. Those companies largely drove the remarkable returns of the US stock market.”
However, “2025 was a bit of a different story. While VTI was up a healthy 17.1%, VXUS surged 32.35%.” (Vanguard Total Stock Market Index ETF VTI and Vanguard Total International Stock Index ETF VXUS.)
“3 Reasons to Own International Stocks:1) Concentration Risk Is High, 2) Sectors Shift, 3) The US Lacks Financial Discipline”
When I comment, I know our investments seem aggressive for our age so I always clarify that our income covers about 120% of our expenses.
We are retired and are both 68 years old. We are and always have been 100% U.S. stock indexes.
Soon we will still be 100% in stock indexes but we are planning on being 25% Vanguard Value etf (VTV) and 75% Vanguard World etf (VT).
It is more about being more diversified, not any U.S.
For our equities, we’ve long been at around 67% domestic, 33% foreign, i.e., around two thirds/one third.
I would be comfortable at no more than 20% of stocks. Last time I checked I was at 15%, and I reallocated to 18%. I will increase it again, if necessary, when I take this year’s RMDs in October.
Robert,
First It appears that your overall allocation is 85% equities/15% bonds, with the equity percentage as a percentage of your TOTAL portfolio.
For clarity sakes I want to explain that for my consideration of the weighting of international vs US stocks I consider what portion of my EQUITY position is international vs US. That being said the US is approximately 2/3 of the world stock market so I have always tried to match that percentage. I know that my international exposure has been an overall
drag on my portfolio I have averaged an 8.6% overall return over the past decade which I am fine with. This is with an overall portfolio allocation of 45/45/10. When we claim Social Security in a few years I will switch to a pure bucket approach and since the majority, if not all, of our expenses will be met with our SS income our equity exposure will increase dramatically.
Fidelity suggests a 15% allocation to international equities. We are at 12%, but may start increasing toward 15%.
63/37 US v International. I basically mirror the cap weighting on a global basis.
I just checked our main Vanguard fund – Vanguard Australia High Growth Index Fund. The Australian allocation is about 35%, remainder international shares (which will obviously have a large US exposure).
Australia is a small market so having a relatively small allocation is sensible. However we do get some good tax benefits from Australian shares, particularly those paying healthy dividends, by way of “franking credits”. So some degree of home bias makes sense for Australian investors.
I read something fascinating in the January 8th edition of Adam Grossman’s daily personal finance email. He referenced Vanguard studies indicating that over the long-run, ≈ 35% foreign diversification puts you on the efficient frontier for lowering risk (variability in returns), but does not outperform a 100% US allocation. Nor does it underperform it. Thus it’s entirely a risk reduction play.
You obviously know about risk reduction given your allocation, but it’s news to me that the general sentiment that it’s time for ex-US to outperform may not be a reasonable part of the decision. “It’s time” also smells a bit like the gambler’s fallacy.
I’m going to study this when I get a chance.
Langston,
i also read Adam’s columns, great insights. We have always been 30-40% foreign so i guess we got the variability benefit by accident. My sister that ignores her allocation has been heavy s & p 500 kicked my butt..LOL. Thanks.