How to Invest $10,000 Right Now
Five wealth experts highlight international opportunities as tariff tumult hits US stocks.
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If there’s one benefit to the level of market volatility that US trade policy is provoking, it’s the renewed emphasis on diversification, according to wealth experts.
International investments, in particular, are growing more attractive on speculation President Donald Trump’s increased tariffs and other initiatives could tip the US into a recession and lead to a diminished role on the world stage.
The S&P 500 is down roughly 8.6% so far this year, while the Euro Stoxx 50 index is up about 14% on a currency-adjusted basis through the close of trading Wednesday in the US. So for this edition of Bloomberg’s Where to Invest $10,000, we asked investing experts to focus largely on non-US opportunities. Their highlights ranged from an electricity play in Spain to pharmaceutical companies in the UK to Japanese real estate.
For those who like to invest using exchange-traded funds, Bloomberg Intelligence ETF research associate Andre Yapp provides rough proxies for the experts’ ideas. And for each interview, we also asked the experts how they’d spend a $10,000 windfall on something fun. Ideas stretched from devices to track one’s health to trips to the Canadian Rockies and supporting up-and-coming foreign fashion designers.
Read more: Are you Rich?
Sarah Ketterer, chief executive officer, Causeway Capital Management
Explore European Pharma
The idea: After 17 straight years of US equity market dominance over non-US markets (as measured by the MSCI EAFE Index) through the end of 2024, it’s no surprise that global investors have become a bit too cozy with US stocks. This extended winning streak inflated the valuation premium of US equities to record highs relative to international markets. In 2025, this relationship is shifting to favor non-US markets. Investors can find many world-class international companies trading cheaply relative to their immense future cash flows. For stability and income, European and UK pharmaceutical stocks stand out as exceptionally compelling in this period of tariff uncertainty.
The strategy: European pharmaceutical companies have spent years exiting lower-margin consumer health businesses and now primarily focus on innovative pharmaceuticals manufactured and distributed globally. While some have announced plans to increase their domestic US manufacturing, most companies will continue to use existing, highly efficient global supply chains. Sourcing raw materials from the lowest-cost locations globally ensures both stable pricing and availability. Innovative drugs with few substitutes can pass cost increases on to distributors. These stocks deliver growing dividends, attractive yields versus broad markets and have abundant drug pipelines to keep delivering growing cash flows for years ahead.
The big picture: Diversifying into non-US equities brings geographic, sector and currency diversification. With Germany kicking up its fiscal spending to new highs, Europe could weather current challenges well. Even if geopolitical tensions weigh on all markets, the economically defensive sectors such as health care, with an emphasis on the drugmakers, are positioned to outperform.
Ian Harnett, chief investment strategist, Absolute Strategy Research
Look to Japan
The idea: Over the longer term, we expect international equities to gain ground and the US dollar to weaken. The currency most likely to rally against a weaker US dollar is the Japanese yen, making investing in Japanese real assets an interesting potential investment. Also, in a world of European Union and Chinese reflation, higher tariff-related inflation and a weaker US dollar, we should see commodities such as copper and gold continue to rally.
The strategy:
Japanese assets remain attractive due to the lack of leverage and attractive valuations. However, given that the yen is very weak and is the most likely to appreciate, should the dollar weaken we’d focus on buying real estate (think: hotels) or infrastructure assets, many of which have high dividend yields and relatively stable cash flow. We use private funds to do this.
While you might think copper would be exposed to the downside if there is a recession, it will remain a key ingredient in the long-run recovery and energy transition. It’s also likely to rally if we see a weakening in the US dollar, and it remains a strong hedge against higher inflation. Gold, meanwhile, remains a safe haven in a risky world. We believe there is a major shift from central banks to buy gold as they look to diversify reserves away from the US dollar. If inflation rises, real yields tend to fall, which historically has supported gold prices.
The big picture: We’ve become more cautious on the outlook for US and global equities and expect market volatility to remain elevated. Tariffs tend to push up inflation and push down activity. Historically, this combination has been unambiguously bad for stock valuations. However, one unexpected benefit from the increased economic assertiveness of the US is that it has forced Europe and China into greater fiscal activism. This has seen international equities race ahead of US equities. But, in the short run, this rally may have gone too far.
Russ Koesterich, portfolio manager, BlackRock Global Allocation Fund
Buy European Luxury
The idea: Against most expectations, including my own, European stocks have surged. Year to date, a broad measure of European equities is up about 14% in dollar terms, trouncing US stocks. While I would not chase the broader European rally, there is one segment that looks interesting — luxury goods manufacturers.
The strategy:
While the US continues to host many of the global champions in technology, industry and entertainment, Europe has long had an edge in luxury brands, particularly the world-beating French and Italian labels. But despite the long-term success of these businesses, most are down this year. The Goldman Sachs EU Luxury Goods Basket (GSXELUXG) is off 18% from the February high and to my mind, this is an opportunity.
Much like US technology companies, many of these brands have a unique “moat” that protects their business. They continue to maintain premium pricing and benefit from still strong growth among high-end consumers. On a global basis, these companies are also very levered to China. As the Chinese economy continues to stabilize and policymakers place more emphasis on supporting domestic consumption, European brands stand to be a prime beneficiary of a healthier Chinese consumer.
The big picture: Luxury goods makers, unlike much of the European equity market, have a good long-term track record. As these stocks have sat out much of this year’s rally, this is one segment of the European market I’d be looking to add.
Henry Mallari-D’Auria, chief investment officer of global and emerging markets equities, Ariel Investments
Make a Power Play
The idea: My idea is around electricity. For an economy to grow it needs electricity, and that becomes even more important if you want part of your state or country to benefit from the development of data centers. Meeting demand requires both producing electricity (regardless of whether it is from a renewable or other source) and then moving that electricity to where it is used — transmission. More and more regulators are beginning to understand that they need to set rates of return at a high enough level to induce the investment in both electric generation and transmission.
The strategy:
A stock that gives investors exposure to this is Spanish utility Redeia Corp. Over the past 10 years it hasn’t really grown at all, but Spain still has climate change goals that will result in growth for renewables — and a need within Spain for more investment in transmission to move electricity from renewables plants to homes and industries. Spain is in the process of changing regulation to enable transmission companies like Redeia to earn better returns on capital. So Redeia is expected to see strong growth as it builds new transmission plants, earns higher returns and funds some spending through selling a non-core satellite business.
A second stock we like is Algonquin Power & Utilities Corp., a Canadian electricity producer with some US assets. Regulators in states like Missouri and Arizona, where Algonquin has operations, are realizing that to compete for data centers they need more electricity supply, so are allowing higher rates of return for building new plants. Additionally, the company has a new CEO with a reputation for being very good at reducing costs.
The big picture: Personal consumption and industrial production in the US will grow around an annual pace of 1.5% to 2%. The need for more electricity for data centers would take us above that pace. Current growth in production capacity, particularly in Missouri and Arizona, is far below 1.5% to 2%. This isn’t a situation of buying into an industry that has been overbuilt. We need more capacity, and it’s even more the case in Spain. Europe doesn’t have an energy supply that it can grow more quickly to become energy-independent. Europe will for the foreseeable future require imports of fossil fuels, and so the focus on renewables is part of geopolitical protection.
Gabriela Santos, chief market strategist for the Americas, JPMorgan Asset Management
Bargain-Shop Overseas
The idea: The debate over US exceptionalism has been prominent this year. The secret is: There has already been less US exceptionalism than meets the eye. Since late 2022, there has really only been one extremely exceptional company — Nvidia Corp. S&P 500 returns excluding Nvidia have been bested by those of European and Japanese equities since October 2022. Investors are reassessing the US’s exceptional premium and Europe and Japan’s exceptional discounts. The discounts are in every area except tech, but what’s particularly interesting are financials and industrials in Europe and financials and consumer sectors in Japan.
The strategy: In January, US equities had a 40% valuation premium over international markets. Despite international markets’ biggest outperformance since 1989 in the first quarter, this premium has narrowed but remains at 32%, double its long-run average. This is true across sectors — and has plenty of room to close. Since 2020, earnings growth in Europe and Japan has matched the US, overcoming the post-global financial crisis gap. Although the tariff turmoil presents a short-term headwind, long-term tailwinds remain.
The big picture: As this year’s powerful rebalancing unfolds, we see “push” and “pull” factors continuing to support developed ex-US equities. Push: still-elevated multiples, lower US earnings expectations, and US policy uncertainty. Pull: discounted valuations, nominal growth supporting value stocks, increasing buyback yields, and supportive policy reactions to US policy, like the end of European austerity. In the short term, while Europe rallies, Japan is taking a breather, but its continued improvements in nominal growth and corporate governance are gamechangers.