If you've avoided international stocks over the past five years, you've certainly missed out on a lot of growth. The MSCI EAFE Index, which follows companies based in the developed economies of Europe, Australia, and the Far East (hence, EAFE), has returned 13.79% per year over this period. Some of the companies tracked in this index include foreign stalwarts you may have heard of, such as Sony (NYSE: SNE ) and Vodafone (NYSE: VOD ) .
Emerging-market stocks have done even better than their developed-market counterparts. The Vanguard Emerging Market Index Fund, for instance, whose top holdings include China-based PetroChina (NYSE: PTR ) and China Mobile (NYSE: CHL ) , has returned 26.81% annually since 2001.
By way of comparison, the S&P 500 index -- laden with U.S. blue chips such as Bank of America (NYSE: BAC ) , Hewlett-Packard (NYSE: HPQ ) , and AT&T (NYSE: T ) -- has yielded just 6.09% per year during this time.
Gains to be made
Will international stocks continue to broadly outpace their American brethren into the future? That remains to be seen, but as the past five years have shown, there are tremendous growth opportunities to be found overseas. Many smart investing minds -- Buffett and Siegel the most notable -- have suggested that this trend will continue, and so U.S. investors should look abroad for investing ideas.
In that spirit, we need your help. We've asked some of The Motley Fool's best analysts to chime in with their favorite international plays -- there are 17 ideas in all -- and we want you to weigh in on which will be the best for the year ahead.
You can read their ideas by following the links at the bottom of the page. Once you've read the analyses, head over to the Motley Fool CAPS community-investing database, where more than 13,600 investors have rated 2,630 stocks, and learn even more about the companies you've read about.
Add your thoughts by rating the stocks "outperform" or "underperform" based on how you think the stock will fare versus the S&P 500. The international stock with the most new, net outperform ratings (outperform ratings minus underperform ratings) will win the contest and be crowned The Best International Stock for 2007.
So enjoy the articles and then be sure to make your voice heard by joining the CAPS community. Just click here to get started.
- America Movil
- Lloyd's TSB
Todd Wenning does not own any shares of the companies mentioned. Vodafone is a Motley Fool Inside Value choice. Bank of America is an Income Investor recommendation. The Fool's disclosure policy is a hero in a half-shell.