Reverse Decoupling: U.S. Dividend ETFs Outperform Their International Counterparts

The world is entering into a divergent environment: recently, U.S. dividend ETFs have outperformed their international developed country and emerging market counterparts. There has been a consistent pattern that U.S. equities have been strong while stocks in other parts of the world have exhibited lackluster performance.The performance of both equity and fixed income markets largely reflects the underlying economic development: the U.S. economy, while still being bogged down by its debt and high unemployment numbers, has recovered slowly. Meanwhile, the eurozone economy is ladened with peripheral countries' debts and fiscal difficulties. Emerging markets, with global trade imbalance being adjusted through currency manipulation and trade restriction, have to deal with rising inflation and higher cost of living. As the largest consumer of goods in the world, U.S. is using its monetary policy to influence the rest of world. This is the start of a long period of adjustment.... Read more