A Different Type of World Map
Michael Foster, CFA, CFP®
The default ticker at the top of the Wall Street Journal’s website lists several US indices, Bitcoin, Crude Oil, and Gold, but no mention of global stocks. CNBC’s, Yahoo Finance’s, and Morningstar’s site tickers all default to a US-centric tab. Several publications quote the S&P 500 (largest 500 US companies) or Dow Jones Industrial Average (30 large US companies) when discussing stock performance. Unless you’re actively looking for it, global stock performance may not be that easy to find.
I think that’s a shame. It’s not that I have anything against showing US stock performance (it’s far and away the largest market), but there’s such a large chunk missing from the front and center. The map below is one of my favorite graphics to show clients. Depicting the world stock market as a global map gives investors an idea into how much is available to them. If you only focus on the US, you are missing out on 40%+ of the world market.
Source: Dimensional Fund Advisors
This is important not only from a knowledge base, but in your investment portfolio as well. We encourage clients to hold globally diversified portfolios across the US, international developed, and emerging markets. This gives them exposure to thousands of different companies across multiple countries and continents. Greater diversification can help lessen company or market-specific risk.
Next time you come across the flashing red or green stock data on your TV or computer, be sure to check in how the rest of the world is performing as well. There’s usually a global or continent specific section, you just might have to look for it.
The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual. The market and economic data are historical and are no guarantee of future results. All indices are unmanaged and may not be invested into directly. The information in this report has been prepared from data believed to be reliable, but no representation is being made as to its accuracy and completeness.
Nothing in this material should be construed as investment advice offered by Dolan Capital Advisors, Inc. This market commentary is for informational purposes only and is not meant to constitute a recommendation of any particular investment, security, portfolio of securities, transaction, or investment strategy. No chart, graph, or other figure provided should be used to determine which securities to buy, sell or hold. No representation is made concerning the appropriateness of any particular investment, security, portfolio of securities, transaction, or investment strategy. You should speak with your own financial professional before making any investment decisions.
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Certain statements contained herein are statements of future expectations and other forward-looking statements that are based on opinions and assumptions that involve known and unknown risks and uncertainties that would cause actual results, performance, or events to differ materially from those expressed or implied in such statements.
Ben Dolan and Michael Foster are investment advisor representatives of Dolan Capital Advisors, Inc., a SEC-registered investment adviser. Investment advice offered through Dolan Capital Advisors, Inc.