Home Country Bias: If You’re Not Convinced Yet, Look at This

The Dow Jones Industrial Average is as American as apple pie.

For most U.S. investors, the 30 American companies that comprise “the Dow” are the natural starting point of building a portfolio of stocks.

Names like Wal-Mart (WMT)… Disney (DIS)… McDonald’s (MCD)… Caterpillar (CAT)… and Apple (AAPL).

They feel as familiar to U.S. investors as, well, apple pie feels to an Oklahoman at the county fair.

And since familiarity naturally leads to increased comfort and confidence, U.S. investors routinely over-allocate to U.S. stocks – including many of the household names in the Dow.

But as I explained in March (links in the P.S.), truly successful investors resist the urge to feel comfortable in their stock selections. Instead of seeking comfort, the best investors seek markets that show the best chance of outperforming.

And often, outperformance requires looking outside the United States.

That’s certainly been the case this year, as my Cycle 9 Alert subscribers can attest, and as you’ll see in the chart below.

Everyone on CNBC was celebrating the Dow’s crossing of 22,000 last week. But they neglected to tell you how foreign stock markets have been a far better bet.

I warnrned back in March that we’d likely see this happen, and I counseled against lazily falling victim to the so-called home country bias.

Stock markets have continued to march higher since then…

The Dow Jones Industrial Average is up a further 5.6%.

But foreign markets have continued to outpace U.S. stocks.

Germany gained 8%… and is now up 16.1% year to date.

Chinese stocks climbed 8.6%… now up 21.5% year to date.

Spanish stocks rose nearly 14%… putting their year-to-date gains at 26.5%.

And Mexican stocks climbed a further 15%… putting them in the #1 spot, up 30% year to date!

Here’s that chart, summarizing the year-to-date returnrns of the world’s Top 15 economies:

As you can see, most foreign markets have fared better than the Dow in 2017.

Chinese stocks have provided double the returnrn.

Mexican stocks have nearly tripled it!

Who would have predicted this?!

Look, I get it… investing in foreign stock markets feels riskier than investing in the All-American names.

But doing what felt riskier (even though it really wasn’t) has led my Cycle 9 Alert subscribers to big money in foreign markets this year!

You see, I’m not a proponent of buying foreign stocks and holding them indefinitely.

Instead, I use a forward-looking algorithm to identify pockets of outperformance opportunity in foreign stock markets – “sweet spots,” if you will.

And so far this year, I’ve identified a number of these lucrative opportunities.

In early March, just a week before I sent you my warnrning about home country bias, I recommended my Cycle 9 Alert subscribers make a bullish play on European stocks.

They locked in a 41% profit just two weeks later… and a further 213% profit by June 2nd.

Then, on April 4th, I recommended another bullish foreign market play… this time on Chinese stocks.

That play handed my subscribers profits of 49%… 149%… 176%… and 362%… over the following four months.

Then, in early May, I recommended yet another foreign stock market play… this one on Mexican stocks.

Our foray into Mexican stocks handed us gains of 89% and 115% in under three months (and we’re still accruing profits in this position currently).

And finally, I recommended a play on the Canadian dollar in mid-June.

Less than one month later, my subscribers locked in a 130% profit.

Frankly, it’s been an incredible run!

My forward-looking algorithm has identified a number of lucrative “sweet spots” in foreign stock markets… markets that have, indeed, outperformed U.S. markets by wide margins.

But the best part is… I expect the trend of foreign-market outperformance to continue.

That means you still have time to get in if you’re willing to look beyond the perceived comfort of U.S. stocks.

So take off your home-country-bias “blinders” and hop on the opportunities still available in China, Mexico, Canada and beyond!

To finding profits,


Editor, Cycle 9 Alert

Follow me on Twitter @InvestWithAdam

P.S. Click here to gain access to our current Cycle 9 Alert portfolio. And then you can click here, and here, to read my original warnrnings against the pitfalls of the home country bias, as well as our infographic.