We have been advocating Freedom Investing since 2004. Every year, The Heritage Foundation evaluates all the world’s countries using their Index of Economic Freedom, where a high score correlates to nearly every positive measure of a country. We then use this ranking and efficient frontier analysis to craft our Foreign Stock investment strategy that we call “Freedom Investing.”

This article is part of my series where I review how Freedom Investing performs for the quarter. In this analysis, I have used the actual products we are investing in rebalanced monthly to our static asset allocation targets with returns ending March 31, 2024. This analysis does not reflect our dynamic tilt or our individual stock foreign health care strategy, both of which we implement in client portfolios.

For benchmarks, I have used actual products as comparison. The EAFE (EFA) should be compared to Developed Freedom Investing, Emerging Market (VWO) should be compared to Emerging Market Freedom Investing, and the All World ex-US (ACWX) should be compared to the Overall Freedom Investing.

In July 2023, our Investment Committee changed our emerging market strategy to reduce our exposure to China by adding an ex-China fund. For the purposes of this model, those changes are assumed to have been implemented during the July 1, 2023 rebalancing. You can read more about those changes in “Adding an Ex-China Fund to Our Emerging Market Strategy (July 2023).”

In March 2024, our Investment Committee updated our Freedom Investing strategy for the new 2024 Index of Economic Freedom and updated our Emerging Market strategy. For the purposes of this model, those changes are assumed to have been implemented during the March 1, 2024 rebalancing. This includes reclassifying South Korea from an emerging market to a developed market. You can read about those changes in “2024 Index of Economic Freedom Update” and “Updates to Our Emerging Markets Strategy (March 2024).”

Last quarter, we saw that in 1-year returns ending December 31, 2023, Developed Freedom Investing had a -3.97% disadvantage, Emerging Market Freedom Investing had a +4.9% advantage, and Overall Freedom Investing had a -1.27% disadvantage.

This quarter, we saw that in 1-year returns ending March 31, 2024, Developed Freedom Investing had a -5.8% disadvantage, Emerging Market Freedom Investing had a +3.83% advantage, and Overall Freedom Investing had a -2.89% disadvantage.

You can find our articles reviewing the performance of Freedom Investing here.

	Ticker	3-Month	6-Month	9-Month	1-Year
iShares MSCI EAFE ETF (Market Return)	EFA	5.99%	17.34%	11.55%	15.17%
Developed Freedom Investing		2.05%	14.50%	8.76%	9.37%
Australia	FLAU	1.35%	16.21%	10.97%	11.45%
Austria	EWO	0.50%	13.87%	10.24%	13.79%
Denmark	EDEN	8.94%	21.92%	14.71%	17.60%
Finland	EFNL	-2.14%	9.93%	1.87%	-4.77%
Germany	FLGR	7.75%	22.15%	12.34%	16.38%
Ireland	EIRL	13.43%	28.66%	20.65%	27.68%
Netherlands	EWN	10.87%	31.12%	15.19%	19.46%
New Zealand	ENZL	-6.20%	4.85%	-5.19%	-6.07%
Norway	ENOR	-3.70%	1.82%	8.23%	6.75%
Singapore	EWS	-1.82%	3.10%	2.21%	-1.17%
Sweden	EWD	1.24%	24.19%	15.60%	15.21%
Switzerland	FLSW	-0.92%	10.02%	3.58%	7.73%
South Korea	FLKR	3.03%	16.85%	9.63%	13.85%
	Ticker	3-Month	6-Month	9-Month	1-Year
Emerging Markets Freedom Investing		2.38%	13.06%	8.37%	10.99%
Emerging Markets	VWO	1.72%	8.92%	5.84%	7.17%
Emerging Markets ex-China	XCEM	2.74%	14.84%	10.10%	16.41%
Taiwan	FLTW	6.11%	23.41%	16.74%	21.67%
South Korea	FLKR	3.03%	16.85%	9.63%	13.85%
Chile	ECH	-5.81%	2.10%	-8.36%	-3.38%
Mexico	FLMX	2.62%	20.38%	13.24%	19.42%
	Ticker	3-Month	6-Month	9-Month	1-Year
Overall Freedom Investing		2.18%	14.00%	8.65%	9.99%
iShares MSCI ACWI ex US ETF (Market Return)	ACWX	4.60%	15.21%	10.03%	12.88%

For more information about Freedom Investing, you may enjoy reading “A 25-Year Review of Freedom Investing” or “Risk-Return Analysis of Freedom Investing.”

Photo of Ireland by Vadim Burca on Unsplash. Image has been cropped. Returns data gathered from Morningstar Advisor Workstation.