Many investors hope to diversify systematic risks by balancing their portfolio allocations between various countries or regions. As your article notes (“Investors ask ‘what next’ as the American fever breaks”, Opinion, May 22), these investors have begun to question their large exposure to American equities.
My personal investment philosophy is to invest in great companies demonstrating compounding potential with wide competitive moats. It just so happens that the vast majority of these companies are in the US. For now, that means I am quite overweight towards US equities. Increasingly, however, more great companies are emerging from other parts of the world. I therefore expect my participation in the rest of the world to increase over time, but not out of some response to current geopolitics.
It is very hard to predict changes in the global macroeconomic order. Luckily, that falls outside my pay grade. I would encourage other investors who feel similarly to focus on company fundamentals and long-term secular trends.
Jorge Fernandez
San Pedro Garza García, NL, Mexico