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Chart of the week

Domestic resilience in vogue amid selloff

S&P firms with a global focus have been at the heart of this year’s selloff. U.S.-oriented firms have skirted trade tensions and fared better.

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April 4, 2025 | 2 minute read

YTD returns by revenue exposure: Foreign vs. U.S.

Line chart that splits the S&P 500 based on revenue sources: Higher-than-average foreign (black line) vs. domestic (orange line). Amid rising trade tensions, the 250 companies with the highest percentage of domestic sales have significantly outpaced those that derive more revenue from foreign sources.

Source: Bloomberg Intelligence, L.P., as of April 3, 2025. The S&P 500 Foreign Revenue Exposure Index is designed to measure the performance of companies in the S&P 500 with higher-than-average revenue exposure to foreign sources. The S&P 500 US Revenue Exposure Index is designed to measure the performance of companies in the S&P 500 with higher-than-average revenue exposure to the U.S.

  • A divide has opened amid stocks’ challenging headline returns this year. The S&P 500 has fallen -7.9% in 2025, driven by the largest multinational firms (primarily the Magnificent 7 stocks) which have greater exposure to foreign revenue sources.1
  • The chart splits the S&P 500 based on firms’ foreign and domestic revenue composition. So far in 2025, the 250 companies with the highest percentage of domestic sales have declined just -1.0% compared to -11.5% for the 250 firms with a higher percentage of foreign sales.1
  • One challenge investors face across public equities is that the market cap of the 250 foreign- exposed stocks is double that of their more domestically focused peers. Therefore, these firms drive a disproportionate share of the Index’s return.
  • Private equity and private credit strategies focused on the U.S. middle market allow investors to capitalize on this domestic outperformance, providing partial insulation from tariff-related risks and offering the potential for enhanced income and growth during periods of heightened uncertainty.

  • Bloomberg Intelligence, L.P., as of April 2, 2025.

The chart of the week and any accompanying data is for informational purposes only and shall not be considered an investment recommendation or promotion of FS Investments or any FS Investments fund. The chart of the week is subject to change at any time based on market or other conditions, and FS Investments and FS Investment Solutions, LLC disclaim any responsibility to update such market commentary. The chart of the week should not be relied on as investment advice, and because investment decisions for the FS Investments funds are based on numerous factors, may not be relied on as an indication of the investment intent of any FS Investments fund. None of FS Investments, its funds, FS Investment Solutions, LLC or their respective affiliates can be held responsible for any direct or incidental loss incurred as a result of any reliance on the chart of the week or other opinions expressed therein. Any discussion of past performance should not be used as an indicator of future results.

This information is educational in nature and does not constitute a financial promotion, investment advice or an inducement or incitement to participate in any product, offering or investment. FS Investments is not adopting, making a recommendation for or endorsing any investment strategy or particular security. All views, opinions and positions expressed herein are that of the author and do not necessarily reflect the views, opinions or positions of FS Investments. All opinions are subject to change without notice, and you should always obtain current information and perform due diligence before participating in any investment. FS Investments does not provide legal or tax advice and the information herein should not be considered legal or tax advice. Tax laws and regulations are complex and subject to change, which can materially impact any investment result. FS Investments cannot guarantee that the information herein is accurate, complete, or timely. FS Investments makes no warranties with regard to such information or results obtained by its use, and disclaims any liability arising out of your use of, or any tax position taken in reliance on, such information.

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