Week of January 30, 2023
It has been observed in tracking investment data by geographic sector and market capitalization over long periods of time that returns tend to converge (8%- 10%). When returns deviate in the short term, it is reasonable to expect that a regression to the mean will follow. For the last several years, international equity investments have lagged the returns of domestic investments. In 2023, international equity investments are outperforming domestic. We believe this trend will continue, and we have changed our Sigma Signals to suggest a tilt to international equity investments.
Bob Bilkie, CFA