Over the past year, more and more people have asked some version of the same question.
“How exposed am I to the US?”
It’s a fair question. The US dominates global sharemarkets, US politics fills the news, and many of the companies people recognise most are American. When markets feel uncertain, it’s natural to want to know whether too much of your money is tied to one country.
But in practice, that question often mixes together two very different concerns. Untangling them makes the conversation much clearer, and usually much less alarming.
The first concern is about concentration.
This is the simple version.
If a large part of a portfolio is invested in companies listed in the United States, then movements in US markets will matter. If US shares fall sharply, portfolios with higher US exposure will feel it more.
That’s real, and it’s something we measure carefully.
The second concern is subtler, and often more important. It’s about exposure to the US economy itself. People worry that a slowdown in the US, political dysfunction, or fiscal stress could directly undermine the businesses they own.
Those two things are not the same.
Take a company like Microsoft. It’s listed in the US and headquartered there, but its customers are businesses and governments all over the world. Demand for cloud services, software, and enterprise systems depends far more on global investment and productivity trends than on whether US consumers are spending more or less this year. Even though it’s a US-listed company, its economic exposure is genuinely international.
Now contrast that with a business like Home Depot. It is also listed in the US, but its fortunes are closely tied to the US housing market, renovation activity, and domestic consumer spending. When interest rates rise or US housing slows, that impact feeds directly into earnings. This is what true US-economy dependence looks like.
Both companies are “US companies” in a legal sense. But the risks they carry, and the forces that drive their returns, are very different.
This is also why we’re careful not to reduce portfolio design to country labels. Where a company is listed tells you something about regulation and market structure. It doesn’t, on its own, tell you what actually drives long-term returns.
Another point that often gets lost in these conversations is that reducing US exposure is not a free lunch. The US market is home to a large share of the world’s leading technology, infrastructure, and enterprise-focused businesses.
Choosing to have less exposure to them isn’t just a geographical decision. It changes the growth characteristics of a portfolio.
That doesn’t mean higher US exposure is always better. It does mean there is a trade-off. Lower US exposure usually comes with lower exposure to some of the most dynamic parts of the global economy. Whether that trade-off is appropriate depends on a person’s objectives, risk tolerance, and time horizon, not on headlines.
When clients raise concerns about US exposure, our first step is not to reach for a switch. It’s to understand what they’re really worried about. Is it volatility? Is it concentration? Is it political risk? Or is it a broader discomfort with how dominant the US has become in markets?
Often, once we separate those threads, the answer is explanation rather than change. In some cases, a portfolio adjustment is appropriate. In others, staying the course is the more considered decision.
The important thing is that “US exposure” is not a single, simple risk. Treating it as one can lead to decisions that feel reassuring in the moment, but don’t serve long-term goals.
Good portfolio decisions are rarely about avoiding one country or chasing another. They’re about understanding what you own, why you own it, and how it fits into the life you’re trying to fund.
