Chapters
01
The fast view02
Introduction03
The four reinforcing forces acting on US vs non-US return cycles04
Reframing regional equity allocations for the new cycle05
Conclusion01
The fast view
A quick overview of the key themes in this research, showing how the reinforcing forces that sustain dollar cycles also shape the relative performance of US and non-US equities.
- US equities have outperformed both developed and emerging market peers for over a decade, shaping today’s portfolio allocation patterns.
- The US dollar has also been exceptionally strong for many years, and there is a remarkable historical overlap between these long dollar cycles and the relative performance of US versus international equities.
- Current conditions, valuation extremes, divergent policy trajectories, and recent shifts in capital flows suggest markets may be at a critical inflection point.
- The next cycle could broaden equity market leadership significantly, driven by AI innovation and a weaker dollar, creating opportunities across sectors and regions.
- Fundamental indicators suggest a lower allocation to US equities than implied by market-cap benchmarks, with international and emerging markets offering potentially stronger returns.
