The dominance of the US stock market relative to other equity markets over the past 15 years is an enigma for many investors who were taught to believe in international diversification. As shown in the accompanying chart, US equities have outperformed international equities in most years since the 2008 Financial Crisis. In the process, the US market’s capitalization has gone from being on par with that of both Europe and Asia to being roughly three times greater.
US Equity Performance Relative to EAFE, annual returns in local currency
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