State Street SPDR Dow Jones REIT ETF (RWR)

Alphabet is a holding company that wholly owns internet giant Google. The California-based company derives slightly more than three-fourths of its revenue from Google services, the vast majority of which is advertising sales. Alongside online ads, Google services houses sales stemming from Google’s subscription services (YouTube TV and YouTube Music, among others), platforms (sales and in-app purchases on Play Store), and devices (Chromebooks, Pixel smartphones, and smart home products such as Chromecast). Google’s cloud computing platform accounts for more than 20% of Alphabet’s revenue. The firm’s investments in up-and-coming technologies such as self-driving cars (Waymo) and health (Isomorphic) make up the rest.

Alphabet is a holding company that wholly owns internet giant Google. The California-based company derives slightly more than three-fourths of its revenue from Google services, the vast majority of which is advertising sales. Alongside online ads, Google services houses sales stemming from Google’s subscription services (YouTube TV and YouTube Music, among others), platforms (sales and in-app purchases on Play Store), and devices (Chromebooks, Pixel smartphones, and smart home products such as Chromecast). Google’s cloud computing platform accounts for more than 20% of Alphabet’s revenue. The firm’s investments in up-and-coming technologies such as self-driving cars (Waymo) and health (Isomorphic) make up the rest.

As worldwide markets remain challenged amid a backdrop of higher interest rates and ongoing conflict in the Middle East and Ukraine, one thing has not changed. U.S. stocks are more expensive than global stocks. And that's the case even with the impressive returns from global stocks in the past 18 months. Consider P/E ratios. The trailing P/E ratio on the S&P 500 is now 25, above the global average of 17 and well above the 11-12 average P/Es for emerging markets stocks in China and Latin America. A review of yields tells a similar story. The current dividend yield for the S&P 500 is 1.0%, versus the global average of 2.1% and European and Latin American yields of 3%-4%. Investors generally are willing to pay a higher price for North American securities for several reasons, including the transparency of the U.S. financial system as well as the liquidity of U.S. markets. What's more, global returns can be volatile across individual countries, given currency, security, political, and geopolitical risks. Indeed, U.S. stocks (ETF SPY) have outperformed Europe, Australasia, and the Far East (EAFE, and ETF EFA) over the past five years. The tide turned a bit in 2025, as investors responded to the uncertainty over U.S. trade policy and as global central banks lowered rates. Last year, foreign stocks were up 28% while U.S. stocks rose 16%. Meanwhile, the outperformance of emerging markets over domestic markets has continued in 2026. Given expectations for improving economic growth in Europe and Japan in the months ahead, we think that diversified investors should have 20%-25% of their equity allocations in international stocks to take advantage of the value, and we have been adding global stocks to our Universe of Coverage.

Netflix’s relatively simple business model involves only one business, its streaming service. It has the biggest television entertainment subscriber base in both the United States and the collective international market, with more than 325 million subscribers globally. Netflix has exposure to nearly the entire global population outside of China. The firm has traditionally avoided a regular slate of live programming or sports content, instead focusing on on-demand access to episodic television, movies, and documentaries. The firm introduced ad-supported subscription plans in 2022, giving the firm exposure to the advertising market in addition to the subscription fees that have historically accounted for nearly all its revenue.