Non-U.S. stocks will be particularly attractive to U.S. investors if the U.S. dollar continues to fall against foreign currencies. Many are predicting such a decline. One analyst even expects the dollar to “wipe out all its post-pandemic gains.”
A declining dollar DX00,
U.S. investors who own non-U.S. stocks have been enjoying this double-barreled gain since last September, when the U.S. Dollar Index DXY,
While there’s no guarantee the U.S. dollar will continue declining, a bet in favor of non-U.S. stocks has a non-currency-related factor in its favor as well: relative valuation. The U.S. stock market is the most overvalued in the world right now, as judged by the Cyclically-Adjusted Price/Earnings ratio (CAPE), which was made famous by Yale University professor (and Nobel laureate) Robert Shiller. In contrast to a 30.8 CAPE for the U.S, Europe’s is 17.4 and Asia’s is 13.8. (See chart below.)
The easiest and cheapest way for U.S. investors to bet on non-U.S. stocks is via an index fund. Vanguard Total International Stock ETF is one of the cheapest, with an expense ratio of just 0.07% — $7 per $10,000 invested.
If you want to try betting on individual stocks, below are those of non-U.S. companies that currently are recommended for purchase by any of the top-performing newsletters that my auditing firm monitors. They are grouped by the countries in which they are headquartered, and then in alphabetical order.
Stock | Country |
BROOKFIELD REINSURANCE LT (BNRE) | Bermuda |
STONECO LTD (STNE) | Cayman Islands |
COMPANIA CERVERCERIAS UNI (CCU) | Chile |
NOKIA CORP (NOK) | Finland |
AXA SA (AXAHY) | France |
SANOFI (SNY) | France |
TOTALENERGIES S E (TTE) | France |
ALLIANZ SE (ALIZY) | Germany |
BASF SE (BASFY) | Germany |
BAYER A G (BAYRY) | Germany |
DEUTSCHE POST AG (DHLGY) | Germany |
SIEMENS A G (SIEGY) | Germany |
VOLKSWAGEN A G (VWAGY) | Germany |
AERCAP HOLDINGS NV (AER) | Ireland |
CIMPRESS PLC (CMPR) | Ireland |
EATON CORP PLC (ETN) | Ireland |
MEDTRONIC PLC (MDT) | Ireland |
SEAGATE TECHNOLOGY HOLDIN (STX) | Ireland |
ITURAN LOCATION & CONTROL (ITRN) | Israel |
PERION NETWORK LTD (PERI) | Israel |
HONDA MTR LTD (HMC) | Japan |
TOSHIBA CORP (TOSYY) | Japan |
KONINKLIJKE PHILIPS NV (PHG) | Netherlands |
NXP SEMICONDUCTORS NV (NXPI) | Netherlands |
HOLCIM LTD NEW (HCMLY) | Switzerland |
NOVARTIS AG (NVS) | Switzerland |
BP P L C (BP) | United Kingdom |
HENDERSON GROUP PLC (JHG) | United Kingdom |
RIO TINTO (RIO) | United Kingdom |
VODAFONE GROUP PLC NEW (VOD) | United Kingdom |
Mark Hulbert is a regular contributor to MarketWatch. His Hulbert Ratings tracks investment newsletters that pay a flat fee to be audited. He can be reached at mark@hulbertratings.com
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