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Portfolio > Economy & Markets > Stocks

Investors Hiding Overseas May Forgo U.S. Volatility: Searching for Alpha for April 2015

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Domestic stock indexes had a wild ride in the first quarter. After a rough January, ebullient February and punishing March, the S&P 500 and the Dow had nothing to show for it but a tiny gain. Considering the uncertainty on the economic and interest rate front, these volatile conditions are likely to continue. 

A less obvious place to hide from the storm may be international stocks. Focusing on areas where economic growth is muted may seem like a strange strategy, but it is in those areas that economic stimulus measures will be the boldest. That means that Japan, a country grappling with deflation, and Europe, which struggles with everything related to capitalism, look attractive.

I’ve discussed the valuations difference between domestic and foreign stocks in previous posts.

Those observations are still valid, and even after a quarter of catching up it’s still worth considering investing outside the U.S.

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