Don't Count Them Out Yet: Why International ETFs Could Still Outperform in 2026
The Motley Fool
by newsfeedback@fool.com (Matthew Benjamin)February 13, 2026
AI-Generated Deep Dive Summary
International equities have shown a tendency to outperform U.S. stocks in recent years, and there is potential for this trend to continue into 2026. This inverse relationship between U.S. and international markets is not entirely predictable but often reflects broader economic dynamics. While the U.S. economy remains the largest globally and its equities dominate global market capitalization, non-U.S. stocks can act as a counterbalance when U.S. markets face challenges.
The article highlights that the U.S. stock market's sheer size and influence can sometimes suppress international performance during periods of strong U.S. economic growth. However, this dynamic also creates opportunities for international equities to shine when U.S. markets encounter headwinds, such as recessions or geopolitical tensions. This alternating pattern is driven by factors like differing economic cycles, currency fluctuations, and varying levels of investor sentiment across regions.
Understanding these dynamics is crucial for investors looking to diversify their portfolios. International ETFs offer exposure to a wide range of global markets, providing both diversification benefits and the potential for higher returns when non-U.S. equities gain momentum. As global markets continue to evolve, the interplay between U.S. and international stocks will likely remain a key factor in investment strategy.
For readers interested in finance, this insight underscores the importance of considering global market trends and economic indicators when making investment decisions. By staying informed about these dynamics, investors can better position their portfolios to capitalize on opportunities in both domestic and international markets.
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Originally published on The Motley Fool on 2/13/2026