Abstract

For US investors, international equity exposure has never been so readily available at such a low cost. Nonetheless, surveys indicate US investors typically allocate 80–85% of their equity holdings to US equities, much higher than their proportion of global market value. In this note we evaluate arguments often proposed in support of high levels of Home Bias. We conclude that on the whole they support a very moderate amount of home bias in international equity investing. While written from the perspective of US investors, the discussion in this article applies equally well to investors throughout the world.

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