An XRay analysis of my rollover IRA at Fidelity shows: Foreign equities   24.36%, US equities 33.18%, remainder (bonds, cash, other).

My foreign exposure is in FDIVX and FIGRX, with additional foreign in FBALX and TAVFX. When I went to XRay Interpreter, I was quite surprised that M* said my foreign exposure was "too heavy". I thought my foreign holdings were well within the amount usually recommended on these boards.

The analysis also indicated Europe holdings as low, and Asia & Pacific very high. Does anyone have a comment on this? As I said, I thought my foreign was OK!

Bill K

I think the Xray interpreter compares your portfolio to some index.  What is the index?  Whatever it is, I think the index is light on emerging markets and heavy on developed markets.

There a a number of financial guru's in the media these days that are saying the 20% rule is outdated.  This is especially true with a weak dollar.  They are now suggesting more like 40-50% foreign.

I'll continue to be more foreign until the US markets get their act together, most likely 2009 or 2010.  New president, bad economy, high gas prices, housing bubble, banking mess,  this will take 1-2 yrs to straighten out..

42% foreign is high... too high?  I don't know.  I don't think so.

erryl

Erryl, you may have misread my post. I said my foreign holdings are 24%, not 42%Anyway I get your point. You and others seem to strongly disagree with M* analysis that my foreign holdings are "too high". I wonder why they believe so

Bill                            

I'd take the M* X-Ray analysis with a grain of salt :

• Many US companies have heavy foreign business exposure; and some foreign companies have heavy US exposure.  What matters is how and where companies do business, not where they are incorporated.

• I do not think it's vital to be invested everywhere at all times.  On being underexposed to Europe, it's a tough call. Valuations are not bad there at present, however companies are having to deal with the reality of an expensive Euro.  (Of course that's a two-edged sword.)  Within Europe, only England, Spain, and Ireland are experiencing a US-type real estate sector problem - so we have to differentiate.
  

Ultimately, I could not care less about what the M* X-Ray suggests. Better to invest in what is strong and avoid what is weak, IMHO.

Your foreign is 42% of equities, at least the way I read your post.  I believe that this is the only ligitimate way to look at your foreign weighting, not % of portfolio.. 

% of foreign in equities = [% of portfolio in foreign stocks / (% of portfolio in US stocks + % of portfolio in foreign stocks)] X 100%

For example, the portfolio analyzer could say that the foreign % is 10%, but if your portfolio is only 20% equities, then your foreign weighting is really 50% of equities.  50% of equities better describes your foreign weighting than 10% of portfolio.

erryl