I understand that usually is not a good idea to allocate the majority of your assets in international investments due to currency risk.
Still, when I look at the
Euro Stoxx 50 it seems that it's far worse than the
I know that it's a bad idea to judge the future returns of an index only by its past returns, but that's not my only criteria.
I'm aware that in Europe taxes and regulations are far higher than in the US. In addition, there is no political stability and the welfare state seems to basically kill the economy. In addition, now we have the brexit.
All the above reasons make me thing that the EU market will never (at least I won't see it) have a growth at least similar to the
My question is what are the arguments to say that, for a long term investment strategy (10+ years): the currency risk that involves investing in some
S&P 500 fund/ETF in euros is lower (or higher) than the risk that the
Euro Stoxx 50 involves by itself.
Note: When I say risk, I'm not referring to risk of losing money, I mean to earn much less. My investing interests are long term (more than 10 years), so I'm not concerned about short-term volatility. I'm trying to determine which strategy is more defensive/sensible.