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Source: Morningstar as of 2/29/2020. Performance data shown represents past performance and is no guarantee of future results.

The above chart shows the returns of the MSCI EAFE Index of non-U.S. companies vs. the S&P 500 Index of U.S. companies on a rolling 3-year basis. U.S. equities have significantly outperformed non-U.S. equities over the last 10 years. However, historically, U.S. and non-U.S. equities have traded leadership positions on a rolling basis, which provides important diversification benefits. While some point to rising correlations over time between U.S. and Non-U.S. stocks, we still find the diversification benefits and return potential of non-U.S. equities highly compelling. While there was an increase in correlations between US and foreign equities during the global financial crisis, those correlations have since eased somewhat. A diversified investment approach may help dampen the effects of rising volatility.



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