Announcer:
4 Your Money is brought to you by NelsonCorp Wealth Management.
Brandy Auterson-Hurst:
It’s now time for 4 Your Money. We’re joined by David Nelson, CEO of NelsonCorp Wealth Management. Welcome back, David.
David Nelson:
Thanks, Brandy. Appreciate it.
Brandy Auterson-Hurst:
So the US stock market has been pretty dominant in recent years. What are some of the things you’ve been watching in this area?
David Nelson:
Well, you’re exactly right, and certainly, in the last 16 years the market in the US has exploded as far as on the upside and the rest of the world’s been pretty stagnant. But if we go back to 2008, we see that the US were roughly 40% of the world capitalization as far as the markets. Fast-forward to today, we’re looking at 60%. The chart I have today is going to show us that and it’s going to give us a feel for why is it that we’ve dominated as far as over the last 16 years.
And what we see here is in blue, the US, as far as the earnings that these corporations, primarily the large-cap technology companies, have just had exploding profits up 162% as far as the market as a whole during this window. And if you contrast that as far as to what’s happening abroad as far as in these other countries as a whole, which is in red, we see that in the same period of time that it’s actually negative 2% during that particular period. So it’s just shocking data and, again, certainly worth noting.
Brandy Auterson-Hurst:
So what does this mean for viewers and their investments?
David Nelson:
Well, the takeaway, I think, is that diversification is really important for individuals. But if you look in this 16 year period of time, it certainly cost people a lot of money if they diversified and had a lot of their money as far as abroad versus having it in the United States. So again, diversified, but pay attention to your investments. And again, over a period of time, this has been just a very unusual period as far as that the US has experienced.
Brandy Auterson-Hurst:
All right, David, as always, thanks for joining us.
Investing involves risk. Depending on the types of investments, there may be varying degrees of risk. Investors should be prepared to bear loss, including total loss of principal.
Indices mentioned are unmanaged and cannot be invested into directly.
This video includes a paid appearance.