Global diversification has disappointed; don’t give up on it

THE conventional wisdom in investing insists people should overcome their home bias and invest globally. There are great businesses around the world, the thinking goes, and investors benefit by looking beyond their borders. But this idea is now being tested as never before, particularly among US investors.

The reason: For almost a generation, US public and private equities have thumped their overseas counterparts. Young investors in their 20s and 30s may not even recall a time when the US did not dominate global markets.

The results of the past 15 years are astounding.