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Fund Spy

These Funds' U.S. and Foreign Exposure May Surprise You

The location of a company's headquarters doesn't tell the whole story.

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Over the past 10 years, domestic large-cap funds' regional exposure has changed quite a bit. In mid-2001, 99% of the typical U.S. large-cap fund's portfolio was invested in stocks domiciled in the United States. In July of this year, that level dropped to 92%. This drift reflects relaxed mandates and domestic-fund managers' increasing willingness to hunt for stocks outside the U.S. And to some extent, it highlights the hunger for higher growth rates found in many emerging-markets countries.

Clearly, U.S. equities still grab the lion's share of large-cap portfolios. But there's more to the story. A fund's overall economic exposure can vary significantly from where its holdings are domiciled.

Karin Anderson does not own (actual or beneficial) shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.