Big US stocks surely can’t keep outperforming others forever
Investing solely in the S&P 500 may not be the best strategy for investors due to under-diversification, despite its 8.7% return since 1970. The index's outperformance has been driven by the success of US tech firms, and investors are warned that past performance is not always indicative of future outcomes. Although US companies are innovative, and could outperform due to artificial intelligence, investors should not assume the future will continue to be dominated by large American firms.
Investing solely in the S&P 500 may not be the best strategy for investors due to under-diversification, despite its 8.7% return since 1970. The index's outperformance has been driven by the success of US tech firms, and investors are warned that past performance is not always indicative of future outcomes. Although US companies are innovative, and could outperform due to artificial intelligence, investors should not assume the future will continue to be dominated by large American firms.