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The Impact of Home Country Bias on UK Stock Performance
The chapter explores the challenges faced by UK investors in overweighting domestic stocks due to the consistent underperformance of the UK market compared to the S&P 500 over the last 30 years. It discusses the risks of home country bias and highlights the importance of diversifying internationally to improve risk-adjusted returns and minimize portfolio volatility. The speakers analyze the potential impact of US companies considering relocating from the UK, emphasizing the need for a balanced global market cap weighted fund in investment portfolios.