Asset Classes Explained: Global Equity Pera On The Issues

You are urged to consider carefully whether the services, products, asset classes (e.g. equities, fixed income, alternative investments, commodities, etc.) or strategies discussed are suitable to your needs. It should be noted that investment involves risks, the value of investments and the income from them may fluctuate in accordance with market conditions and taxation agreements and investors may not get back the full amount invested. J.P. Morgan Asset Management’s Long-Term Capital Market Assumptions suggest developed international stocks may produce better annual returns than U.S. equities over the next 10 to 15 years. While international equities have lagged U.S. stocks over the intermediate and longer term, there may be an opportunity for international stocks to demonstrate better performance and diversify investor portfolios.

• J.P. Morgan may hold a position for itself or our other clients which may not be consistent with the information, opinions, estimates, investment strategies or views expressed in this document.
• The MSCI World Index, a common benchmark for global stocks, is still about 70% U.S.
• Click “Continue” to visit the pages for Harding, Loevner Funds, Inc., a familyof mutual funds for US investors.
• Mitigating this, however, are the ongoing and significant risks emanating from the global tariff war and its impact on  potential recession scenarios.
• The dataset for the MSCI World ex-US Index goes back to 1970.

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• Global Equity is a primary driver of investment returns over the long term, in addition to providing liquidity to the portfolio.
• The Institutional Class Z has the lowest expense ratio of the available share classes but requires the highest minimum investment and is not accessible to all investors (see Prospectus).
• Without limiting any of the foregoing, in no event shall MSCI, any of its affiliates or any third party involved in or related to compiling, computing or creating the data have any liability for any direct, indirect, special, punitive, consequential or any other damages (including lost profits) even if notified of the possibility of such damages.
• Since 1970, U.S. and global markets have traded turns in leading performance.

Second, the sample used in the previous analysis pits global equities against an extremely impressive period of US equity returns. If you break out annualized returns by decade, you can see that periods of outperformance and underperformance for global equities have always been part of the deal. To avoid these inadvertent risks and performance gaps, we think it’s imperative for investors to monitor their allocations. Take, for example, a global equity portfolio that is benchmarked to the MSCI All Country World Index (ACWI).

Strategy

This website may provide information about the brokerage and investment advisory services provided by J.P. Concentrated stock positions are large holdings that create unwanted risk to your portfolio or may be difficult to sell. Here’s a look at these changes and how they impact investment markets. This document may provide information about the brokerage and investment advisory services provided by J.P.

Gmo International Opportunistic Val Iv

Investing involves risk including possible loss of principal. Current performance may be lower or higher than quoted.

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As of April 30, 2025, the financials sector carried a 22.8% higher weight in international large value when compared with international large growth. Diversification is a foundational pillar of strategic asset allocation and portfolio design. “Our long-term, high-quality investing philosophy, combined with an emphasis on cost and risk, reflect this focus and are appropriate for a long-term equity investor like PERA.” “We are fortunate at PERA to have the scale, resources, and skill to internally manage equities just as well — if not better — and at a much lower Everestex review cost, than most external equity managers,” Liptak said. The average investment experience of the team members is 18 years, making this a very experienced group of portfolio managers, analysts, and traders. PERA has a strong preference for internal management, with approximately 75% of its Global Equity holdings being managed by in-house investment professionals.

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Overlay programs can help to monitor global exposures, aim to fill in necessary gaps through portfolio completion and ultimately seek to mitigate unintended risks. We believe that illuminates the importance of managing risks in investors’ asset allocations. The model cannot account for the impact that economic, market, and other factors may have on the implementation and ongoing management of an actual investment portfolio. References to future returns for either asset allocation strategies or asset classes are not promises of actual returns a client portfolio may achieve. For example, changes in the historical data from which it is estimated will result in different implications for asset class returns.

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Equities is often cited in institutional research as a starting point for global diversification. How much of a portfolio is typically invested outside the U.S.? In times of uncertainty, that kind of balance can help portfolios stay on track.

• Realizing these growth projections would provide a notable performance catalyst given the low level of starting valuations.
• It is extremely improbable that someone could accurately predict the best-performing asset class year in and year out.
• Parametric provides advisory services directly to institutional investors and indirectly to individual investors through financial intermediaries.
• Whether tariffs remain in place, or are revoked or implemented in another form, the ultimate impact to the global economy is still uncertain.
• Investors considering reducing their allocation to global equities because of recent underperformance may want to consider the perils of chasing performance.

Since 1970, there were 207 months in which US stocks were down. Within these past 44 years are six of the seven longest bull markets in US history (see the following table). First, the diversified portfolio increases the Sharpe ratio by only 5%. Equally important from a diversification standpoint is that these two asset classes experience different levels of volatility, which you can see in the following chart, which breaks out annualized standard deviation by decade.

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Performance may be volatile, and investors could lose all or a substantial portion of their investment. There can be no assurance that any investment product or strategy will achieve its investment objectives or that there will be any return of capital. Read why we still see value in rebalancing—as long as there is disproportionate relative performance between the asset classes. Prospective investors should consult with a tax or legal advisor before making any investment decision. All investments are subject to the risk of loss. Commonly, overlay programs are used between or inter asset classes—for example, rebalancing between equities and fixed income.

Loomis Sayles is a leading investment management firm, delivering innovative strategies through deep research and a commitment to helping clients achieve their financial goals. There is no guarantee that the investment objective will be realized or that the strategy will generate positive or excess return. Performance data shown represents past performance and is no guarantee of future results. All investments are subject to potential loss of principal.

The Institutional Class Z has the lowest expense ratio of the available share classes but requires the highest minimum investment and is not accessible to all investors (see Prospectus). It should not be assumed that investment in the securities identified has been or will be profitable. The value approach to investing carries the risk that the market will not recognize a security’s intrinsic value for a long time or that a stock judged to be undervalued may actually be appropriately priced. None of the MSCI data is intended to constitute investment advice or a recommendation to make (or refrain from making) any kind of investment decision and may not be relied on as such.