Returns from US funds may be muted amid US-China trade tensions

After rallying for 11 years, valuations seem to be on the higher side; patience is key for new investors

US-focused funds available in India have, on an average, run up 17.78 per cent over the past year. Over the past six months, they have risen 10.38 per cent. Their long-term performance has also been very attractive.

The primary reason for the upsurge is that earnings growth for S&P 500 stocks has delivered a surprise. Instead of the -2 to -8 per cent that analysts expected, returns came in the 0-2 per cent range. Also, due to US-China trade tensions, many US-based investors pulled money out of emerging markets and invested it in their home market. Three rate cuts between