After greater than a decade of US market dominance, 2025 could have marked a turning point for global investors. International stocks have risen greater than their U.S. counterparts, reflected in strong earnings growth and supported by political reform momentum and a reassessment of “American exceptionalism.”
This broad-based outperformance across Europe, Japan and emerging markets has investors wondering whether the tide is popping in favor of world diversification. Is this the start of a brand new structural cycle of market leadership or simply a short-term correction after years of imbalance?
Since the Global Financial Crisis (GFC), US stocks have been the core of world portfolios, benefiting from a potent mixture of dollar strength, technological innovation and economic resilience.
This “only game in town” narrative was reinforced by a record bull market in each the dollar and the technology sector, which brought unprecedented capital inflows and led investors to turn out to be structurally obese U.S. assets.
This post is the primary in a series examining whether this outperformance marks the beginning of a structural trend or simply a short lived shift, and the way global investors can prepare for it.
