2024 has been one other beautiful 12 months for the S&P 500 because the index of high US shares has grown 28.33% 12 months thus far. Over 12 months, it’s up 33.27%. The US has been the place to be for years, pushed by the outrageous efficiency of the tech mega-caps.

Fortunately, I haven’t missed out. I’ve tracked its fortunes by way of my holding in Vanguard S&P 500 UCITS ETF and the L&G World Know-how Index Fund, which is three-quarters invested Stateside.

The remainder of my portfolio is made up of particular person UK shares, principally FTSE 100 shares, together with client items big Unilever (LSE: ULVR).

Ought to I purchase much more US publicity?

Unilever has had a bumpy few years. Its dedication to creating its manufacturers “purpose-led”, say, by associating Hellmann’s mayonnaise with broader social targets, was attacked as a distraction from core enterprise fundamentals​.

Fundsmith’s Terry Smith and different shareholders additionally criticised Unilever for poor communication with long-term traders, whereas the board’s failed £50bn bid to accumulate GSK’s client well being division attracted additional derision. Unilever earnings and share price slumped, because it trailed rivals like Nestlé and L’Oréal.

And that’s why I purchased it. The share price took a beating below CEO Alan Jope however I felt it was due a refresh below new boss Hein Schumacher, appointed in October 2022. I purchased its shares in June 2023, and once more in Might and June this 12 months.

After the inevitable share price droop after I parted with my cash (sod’s regulation strikes once more!) Unilever shares rallied. They’re up 22.75% over the past 12 months, though personally I’m up simply 10.91%.

Unilever can nonetheless ship the products

Recently, they’ve plateaued. That’s regardless of Unilever posting a 4.5% leap in Q3 underlying gross sales on 24 October, underpinned by its large 30 ‘power brands’. Volumes grew for the fourth quarter in a row. The outcomes have been stable however not precisely spectacular.

As an enormous packaged items firm, it might be hit by Donald Trump’s threatened tariffs. North America contributes a fifth of Unilever’s turnover and is one in every of its high three strategic precedence markets, together with India and China.

On the similar time, the S&P 500 is using excessive, having breached the 6,000 mark. The US inventory market is difficult to withstand. But it might even have been overbought, with a hefty price-to-earnings ratio of 31.16 instances. That stated, the S&P 500 has been referred to as costly for years, and that hasn’t held it again.

Unilever is comparatively dear for a FTSE 100 inventory, buying and selling at 21.69 instances earnings. That compares to fifteen.51 for the index. The trailing yield is 3.18%, barely under the FTSE 100 common however larger than the S&P 500’s meagre 1.19%.

I purchased Unilever as a result of it was out of favour and felt that gave it restoration potential. So it appears flawed to promote with out giving it time to ship, whereas chasing the S&P 500 larger. Subsequent 12 months might be stickier than many assume for US shares, as inflation could keep uncomfortably excessive. So I’ll stand by my Unilever shares fairly than additional enhance my publicity to US shares.