It would be surprising to find a planner who did not include non-U.S. stocks in a diversified portfolio. But non-U.S. bonds are less automatic. Should international bonds be part of an overall portfolio recipe?

Consider a minimally diversified portfolio that includes four asset classes: U.S. stocks, U.S. bonds, non-U.S. stocks and non-U.S. bonds. Certainly, a high-performance portfolio would include more asset classes, but for this exercise the limited number of classes makes detailed analysis easier. (The performance of the four asset classes over the last decade is shown in the Big Four chart on the next page.)

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