IMHO - International stock outside of the G7 is going to really lag in the short term. Factors to consider:
- Primary world reserve currencies are the dollar, euro and yen. Countries outside of those zones have less monetary policy to exercise in order to minimize damage to their national economies.
- For example, expanding money supply in a developing nation's currency more directly affects inflation, currency devaluation, and makes it harder to service dollar denominated debts.
- While developed nation's economies contract, there is less demand for cheap goods manufactured in developing countries. While the USA has exported its inflation for decades with a current accounts deficit in goods, now the USA will export a large portion of unemployment. To China in particular. Which I am OK with.
- Look for a continuing drop in commodities. While oil looks like it may have found the bottom, wait for steel, rare earth metals, et al to start searching for the bottom.
- Nations outside of the G20 have less capable fiscal and monetary policy makers with fewer tools. Most of the worlds economies have much less margin of resilience. Although their populations travel less, the virus impact may be greater due to poor health care infrastructure and crowded living conditions. Think the working class in NYC is crowded and did not practice social distancing? Just wait for Brazil's terrible journey to get started.
- Supply chains are going to change. When policy makers and CEOs get around to it, suppliers will be closer to home and more diverse. Expect more tariffs to help drive this change. It is an inflationary predictor for USA. International companies will be at a disadvantage. The spread of globalization will stop for awhile, if not retreat.
- Political instability will increase as driven by health care collapse, commodity price collapse and food supply chain shortages. Today, India is starting to feel the effects of virus driven food shortages. Nigeria is getting their economy walloped by low oil prices. Bolivia produces lithium - with Tesla shut down, what is the impact on that country's ability to produce hard currency for world trade?
A USA based index fund will start to look good to me in the 3rd quarter this year.
In the long term? Well, we are all dead anyway.