The whole idea that international exposure from selling products overseas, acts as any type of replacement for actually
investing overseas, doesn't have merit. It's just an excuse for people who want to justify a home-bias. Here's an excerpt from a
recent post on it:
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If Samsung beats Apple in the multi-billion smartphone business, how much will it help me that Apple also sells phones in South Korea?
It's nonsense to say that a companies participation in a market, is an excuse to not own all stocks in that market. I tried to find some correlation between companies with a strong foreign presence, and the performance of the international/domestic market, but was unconvinced. Looking at Fidelity's Export and Multinational Fund - FEXPX, which invests "primarily in securities of U.S. companies that are expected to benefit from exporting or selling their goods or services outside of the United States."
Let's look at the first three phases:
1. International greatly underperformed the US, so we would expect the export fund to be pulled down, yet it outgrows domestic.
2. International drop just about matches the US drop (might have dropped a bit further), yet the export fund is almost flat, not pulled downward.
3. International greatly outperforms the US, but the export fund is in-line with the US.
In short, you shouldn't make investment decisions, based on expectations like "US company share price with a strong foreign presence will be pulled by economic performance in those countries in the long run." unless you have data showing this effect (if it exists) is strong enough to make an impact on your portfolio.
Do you have this data?-------------------------------------------------
That said, the simple answer is the correct one. The true US/International allocation between a 50% VTI / 50% VXUS portfolio...is 50/50.