In this episode we talk about the big choice between investing only in the S&P 500 or building a global portfolio with something like MSCI ACWI. We explain that the US market has been very strong for the last 100 years and now makes up over 60% of the global index. At the same time, we show that no country has stayed on top forever, and that history is full of former champions that later lost their leading position.
We use examples like the UK in the early 1900s and Japan in 1989 to show how dangerous it can be to bet everything on one market. We explain that global diversification works like an insurance policy: you still own the winners, but one bad country cannot destroy your whole portfolio. We also challenge the idea that US companies’ global revenues are a full replacement for owning international stocks directly.
The episode also focuses on a simple philosophy for long‑term investors: instead of trying to guess which country will win, you build a portfolio that can survive many different futures. For passive investors, the message is that a global ETF is usually the easiest and safest choice, because it already has a big US weight and still gives broad protection. In short, you do not have to pick the perfect horse in the race; you can own the whole racetrack and stick with a portfolio you can hold through good and bad times.
Agenda
- Why we compare S&P 500 to global ETFs like MSCI ACWI
- What history tells us about past market leaders and why they lost dominance
- How global diversification protects you when one country disappoints
- Why a global ETF still gives you a big natural allocation to the US
- How to use this to build a simple, long-term portfolio you can stick with
Video and podcast
Listen to “Global Stocks vs US Stocks: Which basket should you choose?” on Spreaker.
