For Some, It’s Time to Look Overseas Again
Your portfolio of American stocks may have suffered lately but, to judge from major indexes, your portfolio of foreign stocks has probably done much worse for far longer.
Much of the difference can be explained by faster economic growth in the United States and a stronger dollar, which reduces the value of assets priced in other currencies. But all good – or less bad – things must come to an end, and many are encouraging investors to prepare for a shift in leadership and a prolonged period of relative strength overseas.
“In the rest of 2016 you’re going to have lots of opportunities in foreign markets, more than in the U.S.,” said Komal Sri-Kumar, president of Sri-Kumar Global Strategies, an investment consultancy. “Foreign markets have had better valuations, and they’re correcting much more sharply.”
“在2016年的剩下的时间里，你将有很多机会投资外国市场，而不只是在美国国内投资，”投资咨询公司斯里库玛全球策略(Sri-Kumar Global Strategies)的总裁科玛尔·斯里-库马尔(Komal Sri-Kumar)说。“外国市场已经有更好的估价，并且它们能敏锐地做出修正。”
Fundamental factors like the interest-rate policies of central banks also could make prospects more favorable for foreign stocks. The Federal Reserve just raised rates for the first time since before the financial crisis and signaled that it would do so four more times this year, although Wall Street is skeptical that domestic economic growth will warrant such aggressive credit-tightening. Other central banks, meanwhile, are headed the opposite way.
“Monetary policy and business-cycle differences play in favor of international markets,” said Steven Wieting, global chief investment strategist at Citi Private Bank. “Central banks in the eurozone and Japan are easing. More than easing in the eurozone; they’re catching up to where the U.S. was four years ago.”
The European Central Bank has been especially loose with credit as it tries to undo the damage caused by its earlier reluctance to match the Fed’s efforts to flood the financial system with money. The Fed’s quantitative easing program – purchases of Treasury bonds and other instruments – ended last year.
Mr. Wieting encourages investing in Europe and oil importers like Japan that benefit from depressed prices. He would avoid countries with economies that depend on resource production, notably Brazil, South Africa and Canada.
David Kelly, chief global strategist at J.P. Asset Management, says that “Europe is looking a lot more promising,” but he finds it “very hard to see Japan make any sustained progress” because of its low population growth and the likelihood of a change in government policy away from weakening the yen. A stronger currency would create difficulties for Japanese exporters.
摩根资产管理（J.P. Asset Management）的全球首席策略师大卫·凯利（David Kelly）说：“欧洲看起来前景更加光明，”但他发现“日本很难保持持续的增长”，因为日本人口增长率低，而且如果不考虑日元贬值的因素，很难看出政府政策有其他改变的可能性。日元升值可能会对日本出口造成困难。
There are enough difficulties in enough places for Hank Herrmann, chief executive of the asset manager Waddell & Reed, to recommend caution before venturing anywhere too far afield. American stocks represent safety to him in an unsafe world.
对于瓦德尔金融公司（Waddell & Reed）的首席执行官汉克·赫尔曼（Hank Herrmann）来说，很难找到足够多的地方去投资，对任何太远的地方投资都应当谨慎。对他来说，美国股票在这个不安全的世界代表着安全。
“I still think there’s enough uncertainty that staying home makes a lot of sense,” he said. “The difference between foreign and domestic may not be sufficient to overcome the uncertainties.”
Mr. Sri-Kumar acknowledges that much can still go wrong in foreign markets, especially in the developing world. In fact, he’s looking forward to it.
“I was negative on emerging markets for quite a while, but with things falling apart, I’m getting superoptimistic,” he said. He sees those markets, and markets dominated by commodity producers, reaching the capitulation stage, where downturns have gone on for so long and prospects look so bleak that investors just give up. That’s often when a lasting low occurs.
His advice is to invest gradually in diversified baskets of emerging markets and commodities, either directly or through shares of companies that produce them, over the next six months, feeding in the same dollar amount at regular intervals.
“You’re going to have a terrific pick beginning in March,” Mr. Sri-Kumar predicted. “The timing could not be better, especially in emerging markets.”