Topics Covered:
Why the market reaction to tariffs is both rational and potentially short-sighted
The long-term outperformance of global vs. domestic firms
How to define and measure global trade exposure at the company level
Real-world trade shocks and what they reveal about investor behavior
The four traits of resilient global firms
Why intangible-heavy businesses are uniquely positioned to weather trade disruptions
International vs. U.S. multinationals: hidden value in non-U.S. stocks
Practical suggestions for portfolio construction in a deglobalizing world
Timestamps:
00:00 – Intro and framing the importance of global trade exposure
02:00 – What triggered the research: Liberation Day and RH’s collapse
04:00 – Global firms vs. domestic: profitability and performance data
05:27 – Historical context: U.S. tariff levels hit 100-year highs
08:00 – The three (conflicting) goals behind tariffs
10:00 – How top S&P 500 companies are actually multinationals
12:00 – Applying the framework to entire indices and regions
14:30 – The 2x2 framework: defining multinational, exporter, importer, domestic
17:00 – Why labeling companies by country of origin is misleading
19:20 – Performance gap: global vs. domestic over time
20:25 – Market-cap vs. equal-weight returns in global trade exposure
21:30 – Services as exports: why trade isn’t just about goods
22:15 – Global firm concentration by country
23:15 – Sector-level global exposure insights
25:06 – Sector vs. stock-level attribution: what’s driving global firm outperformance
26:30 – Three core reasons global firms outperform
29:08 – Fundamental metrics: global firms show higher ROE, ROA, margins
30:10 – Trade Policy Uncertainty Index hits unprecedented levels
31:30 – Do global firms underperform in periods of trade shocks?
33:20 – Is there a geopolitical risk premium?
33:34 – China exposure by industry
36:11 – Can companies pivot production? Apple’s India shift example
38:44 – Employee location data as a proxy for supply chain shifts
39:25 – Ex-China global portfolio performance
40:28 – What makes a supply chain “resilient”?
43:08 – Global firms are more intangible-heavy—why that matters
45:00 – Performance of high vs. low intangible firms (global and domestic)
48:09 – Why intangibles thrive in uncertain times
49:00 – International stocks begin outperforming—will it last?
50:45 – Valuation gap: U.S. vs. non-U.S. global firms
52:46 – Final takeaways: Stay the course and tilt toward resilient global firms
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