We just returned from our buddies’ annual Halloween bash and are catching up on our reading — including a weekend Journal article discussing global stock valuations. We plan to build a country-allocation model soon, perhaps using the iShares MSCI indexes.

In the meantime, there is an easy way to gain exposure to four dozen of the world’s major equity markets in one trade: the MSCI All Country World Index Fund (ACWI) attempts to replicate the price and yield performance of 48 global stock markets.

One of those countries is the United States — a geographic region to which many investors do not need additional exposure on an absolute basis, much less for greater diversification. A related index, the ACWX, helpfully “subtracts” the U.S. from the All Country World Index, leaving you with exposure to the other 47 markets.

The ACWX offers a number of potential benefits:

• diverse exposure to developed and emerging markets;
• low cost: operating expenses of 0.35%;
• high correlation with the underlying markets: MSCI’s benchmarks aim to represent 85% of each market’s public float; and consequently,
• limited exposure to any single company — a crucial safety factor when markets are rotten with surprise defaults and bankruptcies.

Part of the reason we devote time and effort to this blog is to increase our readers’ awareness of the benefits of global, multi-asset category diversification — and to bolster that awareness with a discussion of practical tools for achieving such benefits. In this context, the ACWX is an option for even the laziest U.S.-centric investor.

No vehicle so broadly diversified could hope to capture anything but beta returns, in our view. But for investors not otherwise willing or able to achieve broad international diversification, the ACWX deserves a look. ♦