Are you an American in Israel worrying about your U.S. investments? You’re not alone. A longtime client recently asked me a question I hear often: “Is my portfolio safe?” With the Fed sending mixed signals on interest rates and markets swinging wildly, even seasoned investors are rethinking their strategies.
Why Bonds May Not Be as “Safe” as You Think
My client and I discussed how changes in the Fed’s interest rates impact both stocks and bonds. Many people see bonds as the “safe” part of their portfolio, so my client was surprised to learn that rising rates can lower bond values, especially for long-term bonds. That’s why managing risk is so important. A solid plan includes a mix of stocks, bonds, and other investments. For cross-border investors, keeping a balanced portfolio is crucial for handling market ups and downs.
Managing Big Tech Exposure
During our chat, the issue of tech stocks came up. With giants like Apple, NVIDIA, and Microsoft driving the S&P 500, the index is heavily tied to just a few companies. My client admitted, “I love my tech stocks and how they inflate my portfolio, but I’m nervous about being too exposed.”
This concern is valid. When tech falters, it shakes the market. If your portfolio leans too much on tech, it may be wise to balance it against other sectors and global assets. Tech might still grow, but owning multiple funds in the same sector isn’t true diversification. A well-diversified portfolio offers more stability, which is important for cross-border investors navigating U.S. and global market risks.
The Impact of Global Events
Global events can shake things up. Cross-border investors often feel U.S. market changes even more because they’re watching multiple countries and currencies. Trade tensions or sudden geopolitical shifts can make markets react faster and harder than before.
I told my client to focus on the basics—like a company’s or fund’s fundamentals—and not get caught up in the daily news. Staying steady and sticking to a long-term plan is the best way to keep your strategy on track.
If you’re managing U.S. investments from Israel and want to feel more secure about your portfolio, reach out for a free Cross-Border Financial Evaluation. Schedule a time at profile-financial.com/call.
Douglas Goldstein, CFP® is the director of Profile Investment Services, Ltd. www.Profile-Financial.com. He is a licensed financial professional both in the U.S. and Israel. Call (02) 624-2788 for a consultation on how to set up your American assets to meet your financial goals. Securities offered through Portfolio Resources Group, Inc. Member FINRA, SIPC, MSRB, FSI. The opinions expressed are those of the author and not those of Portfolio Resources Group, Inc. or its affiliates. Neither PRG nor its affiliates give tax or legal advice.
Published March 19, 2025.