Stonks only go up, right? While that mostly rings true for US markets over the long run, it hasn’t been an easy last few years for global stocks, which have been left in the dust by fast-growing US names. However, as US stocks reach record highs, analysts are weighing whether the rally will continue — and some are eyeing opportunities overseas.

It’s a family affair: Recent weeks have seen all-time highs in European, Japanese, and Indian markets, with even previously neglected Chinese and Russian stocks staging a comeback. Until recently, perceived risks from inflation, wars, and elections have kept investors away from global names — but with many international markets offering lower valuations than US stocks, investors are increasingly looking abroad for deals.

• According to World PE Ratio, only three stock markets — Nigeria, New Zealand, and India — are pricier than American stocks, which currently boast a price-to-earnings (P/E) ratio of 23.6x.
• Meanwhile, Chinese (9.4x P/E), Mexican (13.1x), and European markets (14x) are cheaper than US stocks and trade below historical levels.

Buying the international dip

The Bank of America’s March fund manager survey reveals that institutional investors are currently underweight on Eurozone and emerging market stocks compared to historical levels — and their newfound risk appetite could start to close that gap. Capitalizing on that boom could be surprisingly easy.

• To gain exposure to a diverse range of countries, investors can consider buying the Vanguard FTSE Emerging Markets ETFVWO
  or the Vanguard FTSE Developed Markets ETFVEA
  .
• For those interested in investing in a specific country, market-specific funds like the Vanguard FTSE Europe ETFVGK
  , which comes with Europe’s Mag7, or the Franklin FTSE South Korea ETFFLKR
  for South Korean stocks could be viable options.

But investors beware: Despite the potential for international growth, the upside may be limited. US stocks have outperformed their international counterparts in eight out of the ten years between 2013 and 2022, according to Morningstar. Over the last five years, none of the aforementioned ETFs have beaten the S&P 500. Complicating matters, the correlation between US and non-US stocks has increased in recent decades, particularly in the EU and UK, which rely heavily on US sales. Those looking to diversify globally might not like what they find.

Read: Investors turn their attention to Europe’s most valuable stocks (and there’s more than just Novo Nordisk).