Are US stocks really worth a higher valuation than the rest?

The US stock market is at an all-time high, thanks in part to rapid earnings growth and expectations for that to continue. But rising valuations have also played their part, to the point where US equity valuations look, at face value, increasingly stretched relative to those elsewhere. Using insights from our new Equities Dashboard we show that the valuation gap between US stocks and those elsewhere is smaller than it may seem at first glance, and partly reflects “fundamental” differences. Our view is that these differences will persist and help US equities outperform those in most other places over the coming years.