International Equities: More Than Geographic Diversification

Artisan Partners

Research

5 Pages

Artisan Partners argues international equities diversify portfolios through different sectors, revenue sources, and economic exposures—not simply geography. The US now represents 63% of global investable equity value, while S&P 500 companies generate more than 40% of revenue abroad and emerging markets remain less correlated with US stocks.

Key Takeaways

US concentration rises: US equities now represent roughly 63% of global investable market capitalization, up from 43% after the 2008–2009 financial crisis.
Sector exposures differ: The S&P 500 has 36.6% information technology exposure versus 10.1% for MSCI EAFE, while EAFE holds 26.6% in financials.
Revenue bases diverge: US companies generate 58% of S&P 500 revenue domestically, versus just 19% for MSCI EAFE and 22% for emerging markets.
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