Discount Across the Pond

Matthew Allgood |

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Ten years ago, U.S. stocks were cheaper than European ones. But over the last decade, strong U.S. growth helped American markets pull far ahead. That’s starting to shift—European stocks just saw their biggest performance edge over the U.S. since 2007, outperforming by over 10%. Even after that, U.S. shares still look more expensive, trading at 24 times earnings versus just 15 times for Europe. 

This underscores why we maintain globally diversified portfolios—favoring broad opportunity over a concentrated focus—especially when valuations between regions diverge this meaningfully. Our RiskFirst® Process helps us stay alert when valuations stretch too far, especially in uncertain environments, while keeping you on track to reach your financial goals. 

Discount Across the Pond

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Source: Bloomberg, Redwood. Data as of 4/3/2025. Date Range from 4/30/2015 - 3/31/2025. For illustrative purposes only.

Regards,

Allgood Financial

Disclosure: This piece is for informational purposes only and contains opinions of Redwood that should not be construed as facts. Information provided herein from third parties is obtained from sources believed to be reliable, but no representation or warranty is made as to its accuracy or completeness. Charts and graphs are for illustrative purposes only. Discussion of any specific strategy is not intended as a guarantee of profit or loss. Past performance is not a guarantee of future results. The objectives mentioned are not guaranteed to be achieved. Investors cannot invest directly in any of the indices mentioned above. Diversification of asset class is not a guarantee against loss. RiskFirst® is a registered trademark of Redwood Investment Management, LLC.

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