Based on our behavioral indicators our equity exposure to global regions are the following:
Asia 32.91%
Latin America 15.30%
Middle East, Africa 16.13%
Eastern Europe, Russia 15.65%
Japan, Australia 9.19%
Europe 8.84%
US 4.24%
Our US equity exposure is the lowest of all the regions. However, we do have 25% allocation to bonds which are invested in high yield US fixed income. We see bonds are still preferable to stock in the US market. Therefore, we high exposure to emerging market equity and US high yield fixed income.
Our agent-based indicators suggest the US is now 15% under valued and Europe is 20% under valued. Comparing this period to the recovery period after the 2000-2002 recession it will take until the end of 2011 to become fairly valued.
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