I think the reality is that stocks of the developed world should do well. The Japanese are pumping something like 3 trillion yen (about $25 billion) in stocks and roughly $750 million in Japanese REIT's on an annual basis. At the end of October the Japanese Pension Fund also increased its allocations to both Japanese and international stocks from 12% to 25% (that's 25% each not combined) which I think is about $137 billion for each.
The Europeans are in desperate need and will likely make their own QE more aggressive sometime in Q1 2015. I believe this will drive their stock markets higher and will help the US too as some of that money gets invested in the US.
Of course the Nikkei has already seen a good increase since these measures were announced, but if you think about how far the S&P has come since QE started in the US then there should be a lot further to go. Even if you consider the economy of Japan, and maybe even Europe is better than the US was in early 2009, and certainly sentiment is better, I think there's still a long way to go for these markets.
The key is, and I think this the most important part, if you want to invest in Europe and/or Japan, I would want to be hedged against the currency. I have a few mutual funds that are typically not hedged and I'm keeping them but not using them to invest more. To the extent I'm investing more in Europe or Japan I'm using hedged ETFs or the futures market where I can hedge the currency myself.
I also like emerging markets because I think, like Europe, the valuations are more reasonable than the US or Japan right now and I think not many are talking about those markets, partly because they fear they will suffer when/if interest rates start increasing in the US and I tend to believe the Europeans and Japanese will most likely fill in any gaps left by US investors.
So, overall, I think the returns in Europe and Japan will be even better than the US but only if you hedge, but you are quite right that you get a decent amount of foreign exposure just buying the big US companies. Let's just hope they're good at hedging their currency exposure too.

I have been on the global diversification bandwagon since the 90's. In the past several years though, I read more and more that by just holding US based companies, you already have good international exposure. @catch22, I think your 10% number is way low. I believe it is 20-30%. Perhaps I can find something later.
I am more and more going in the direction of US based funds and investing internationally in areas that show future growth like Asia. Many of the funds I own have international components I them and my current international equity allocation is 36%.
Good question and should make for a good discussion. Thanks @catch22.

Morning Coffee Question.
This question is outside of what percentage one may have in bond holdings of various colors; but related to the equity side.
Okay, be diversified, etc. This prospect depends upon the investor.
A good guess may indicate that if one holds U.S. centric funds of whatever flavor, that perhaps 10% of the holdings may be outside of the U.S.; the exception may be in the small cap area. A further presumption will be that especially with the large/mid cap holdings, may have a fair share of earnings from outside of the U.S. With this, one may presume some international equity exposure; whether desired or not.
Just wondering what you may favor and the thought process for your choice; regarding leaning more towards the U.S. equity side or not.
Our house has about 5% of the equity portfolio positioned directly at non-U.S. equity ( GPROX ), with the remainder currently overweighed towards the large and mid cap U.S. equity area.
Well, a somewhat loaded question, with an answer being in the comfort zone of each investor.
Thank you and take care,
Catch

@johnN,
"Is another black-swan or turmoil like event coming soon in 2015? Any thoughts how to play this market?
I am still 80/20 but still have many yrs left. thinking about buying more oil."
IMO, black swans come suddenly and without warning. There is no way to plan for them. You can invest based on the possibility of one happening but that could leave you vastly underperforming the markets when the situation does not materialize. Plus, when the black swan event occurs, you would be super lucky to get out unscathed. Try to call your fund company in the event. All lines busy. Markets might be closed such as after the Sept. 11th attacks.
It sounds like you have a long time horizon ahead. All you can do is make sure your asset allocation is what you want. As you get closer to retirement, going to a more conservative allocation would cushion the effects of a major market downdraft.

@davidrmoran +1

NICSX's annualized 15 year return is 6.78% as of today (Dec 18th), well below SMCDX's 11.47% at the bottom of the linked chart. It's a fine fund, though I've wondered for several years how long A. Nicholas will keep going (he's worked in the industry since the 50s - okay, the late 50s).

>> Markets tanked during that previous dispute.
But that wasn't why, right?

My recollection is that the crisis contributed to investor uncertainty and did impact markets. Hard digging much up on that, but from The National Review:
"In 2000, the market reacted very badly to the election crisis. In the five weeks between Election Day and the resolution in the Supreme Court, the 10-year bond yield fell 53 basis points. The Nasdaq fell 24 percent from November 7 through November 30, 2000. This reaction also reflected the looming recession; technically, it started in March 2001, though revised data show negative results for the third quarter of 2000 and the first and third quarters of 2001."
http://www.nationalreview.com/articles/212647/litigation-jitters/david-malpass

No - 2015 looks pretty good John. But look out in 2016 for a possible replay of the 2000 Bush V Gore Supreme Court battle centered again around Florida. Markets tanked during that previous dispute.
This time it would be Bush V. Clinton with potentually nastier ramifications - as the Clintons are much more "connected" politically than was Gore, who was pretty much an outsider. I'll give it a 25-35% probability. But - has the potential do do a lot of harm.
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Moderators: Go ahead and delete this if too far off base. It's hard to come up with Black Swans that aren't emotionally charged and offensive.

Those are IBD's top mid cap funds?
ACMVX is up 14.73% YTD according to M*. Guess they didn't pay enough to get mentioned.

FYI:
Regards,
Ted
WSJ Slant: http://www.wsj.com/articles/u-s-stock-futures-soar-in-wake-of-feds-stance-on-rates-1418908752?mod=WSJ_hp_LEFTTopStories
Bloomberg Slant: http://www.bloomberg.com/news/print/2014-12-17/asian-futures-rise-amid-s-p-500-jump-dollar-holds-gains.html
Reuters Slant: http://www.reuters.com/assets/print?aid=USKBN0JV1BU20141218
MarketWatch Slant: http://www.marketwatch.com/story/us-stocks-score-biggest-gains-in-years-2014-12-18/print
Markets At A Glance: http://markets.wsj.com/us
Sector Tracker: http://www.sectorspdr.com/sectorspdr/tools/sector-tracker

@Ace: When your performance is in the 100 percentile you should lquidate.
Regards,
Ted
M* AHYAX Performance: http://performance.morningstar.com/fund/performance-return.action?t=AHYAX&region=usa&culture=en-US

FYI: The performance of midcap-stock mutual funds has run a close second to small-cap funds' in the past 15 years.
Regards,
Ted
http://license.icopyright.net/user/viewFreeUse.act?fuid=MTg3Njc2OTM=
Enlarged Graphics: http://news.investors.com/photopopup.aspx?path=WEBlv121814.png&docId=731132&xmpSource=&width=1000&height=1152&caption=&id=731133

FYI:
Regards,
Ted
http://video.cnbc.com/gallery/?video=3000340166&play=1

Hi Derf,
Thanks for asking …
The spiff that you might be referring to is the one I put in place back in October. And, yes as I write I am up about 7% with the S&P 500 Index price reading at about 2040. The more recent dip that I was referring to was the December price decline that I did not take a position in. Perhaps a better wording of the title would have been "Anybody Buy the Recent December Dip in the S&P 500 Index?"
Now, I did start opening positions, a while back, for diverficiation purposes within my portfolio in a commodities fund, JCRAX and a gold fund, SGGDX. Currently, I am a little underwater in these positions, combined, by about four percent. I most likely will wait until the middle of January before I do any buying as I want to see what happens the first couple of weeks in the New Year. And, I also, want to see how my portfolio's asset allocation bubbles at year end.
Hope this helps … and, answers your question.
Old_Skeet
Additional Comment ...
For those that would like reference, I have copied and pasted my post of October 14th comment under a thread started by Junskter titled "Catching Falling Knives." Below is what I wrote ...
Hi Junkster,
Nice to see you posting again. About catching falling knifes ... I don't look at my current special strategy in that light. But, one that uses market money to make new purchases at discount prices. Below is my thinking, my strategy, what I am doing and my anticipated outcome.
I am hoping the 2100 comes to be for a year end close for the S&P 500 Index as forecasted by Birinyi. This would equate to just short of a 12% gain from current levels of 1878. Which is indeed possible should forward earnings estimates materialize as anticipated.
Anyway, I now have my marker on the bet line that it will as I bought again today. With this I have recently bought at the 1970's, the 1920's and the 1870's. My next buy step is the 1820's and then beyond that at the 1770's should we reach these levels on the Index.
Keep in mind that year end mutual fund capital gain distributions are expected to be on the heavy side this year. Since, I take all my distributions in cash I have decided to put these anticipated distributions to work early and use the forth coming distributions to restore the cash position within my portfolio used to make these purchases.
With my average cost on amount invested currently at about 1920 and should the Index reach the forecasted 2100 year end closing mark then this will equal about a 8.5% gain. Should I buy again at the 1820's then this will lower my cost on amount invested to about 1895 and increase the gain to 10.8% should the 2100 mark be reached. With another buy at the 1770's and if the 2100 year end closing mark be reached then this would equate to about a 12.3% gain.
For me it is risk on for the traditional fall stock market rally. After all, the way I look at this is that I am using market money derived from investment distributions to make more market investments which from my thinking is kind of clever by using market products that generated the cash that will, in the end, fund these special purchases.
Should my strategy not play out by year end; I believe it will over time and besides the funds I invested in have a history of paying out good distributions.
Since this is being played in a tax deferred account there are no taxes to pay until withdrawals are made and I am investing in funds that are nav purchases for me.
Old_Skeet
Note ... For tracking purposes my actual average cost on the October spiff equals a reading of about 1905 on the S&P 500 Index. Since, the recent December dip did not reach back of my average cost, I did nothing.

http://www.sec.gov/Archives/edgar/data/1251896/000089418914006007/aegis_497e.htm
At a meeting held on December 16, 2014, the Board of Trustees approved suspending the offer and sale of shares of each class of the Fund, effective after market close on December 17, 2014. At that time, the Fund will be closed to purchases (including those relating to Automatic Investment Plan purchases), except for purchases relating to reinvestment of Fund distributions. In addition, the Fund has assumed a temporary defensive position. This supplement provides new and additional information beyond that contained in the Summary and Statutory Prospectuses and should be read in conjunction with the Prospectuses.
The following is added as the first paragraph under “Purchase and Sale of Fund Shares” in the Summary Prospectus and in the summary section of the Statutory Prospectus for the Fund:
Effective after market close on December 17, 2014, the High Yield Fund will suspend the sale of shares of each class of the Fund to investors, except those shareholders reinvesting Fund distributions.
The following is added as the first paragraph under the title of the section “ABOUT YOUR ACCOUNT – How to Purchase Shares” in the Statutory Prospectus:
Effective after market close on December 17, 2014, the High Yield Fund will suspend the sale of shares of each class of the Fund to investors, except those shareholders reinvesting Fund distributions.

Buy the S&P 500 Index? No. I don't do indexes. I've been buying energy producers through a diversified natural resources fund. There's some S&P 500 companies among the refiners it holds. I though by just one measure - gas at the pump for under $1.50 (after taxes) - oil prices had gotten a bit distorted. At those prices half the population would be crusin around on our deteriorated highways in big fuel guzzling Hummers in a couple years. Just can't forsee that happening.
Albeit, my "bottom up" perspective (from the pump) is just one take. There are larger issues affecting oil prices than what Joe 6-pack pays for a gallon of gas. I do also read about those larger global issues - many of which are discussed here.
Am not ruling out the dire predictions here and elsewhere that we're heading into some type of global deflationary collapse. However, it's an "outlier" IMHO. I'd give it no more than a 35% chance of happening anytime soon. So, I don't invest to protect against deflation, but rather, to hedge against inflation.
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*The $1.50 after-tax pump price cited is probably a little lower than today's actual prices. Remember that oil "leads" (comes down faster than the price of retail fuels) during periods of falling prices.

Old_Skeet: You are correct, 2,125 on S&P 500. Merry Christmas to you !
Regards,
Ted

Hi Ted,
Yep ... Santa is coming! And, I think we will make 2,100 on the S&P 500 Index. I believe this was your call a while back.
Old_Skeet

I did not buy this recent dip as I felt I'd take all my yearend mutual fund distributions in cash and wait for something bigger than the recent dip which by my definition is a decline of up to five percent. I think we will be seeing a pullback (a decline that has a range of 5% to 10%) or perhaps even a downdraft (a decline that has a range of 10% to 15%) to come sometime during 2015. Hopefully, we want get something beyond this that might lead into a recession … but, I indeed feel a good decline in the markets is on the horizon.
I wish all ... "Good Investing."
Old_Skeet