The benefits of investing in international stocks are clear. As shown in "On Top By Tens" chart below, during the 1970s and 1980s, the MSCI EAFE index dominated the performance of the S&P 500. A $10,000 investment in the MSCI EAFE on Jan. 1, 1970, was worth $169,631 by Dec. 31, 1989, compared with $89,172 in the S&P 500.
Since then, performance has changed. U.S. stock as measured by the S&P 500 outperformed the MSCI EAFE during the 1990s. During the most recent decade (2000-2009) the MSCI EAFE was slightly better than the S&P 500 (1.2% vs. -1%).
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