As the U.S. equities market begins to slow down, investors are looking overseas for potential opportunities. But how much foreign exposure do you need for a diversified portfolio?

ETF investors will have to find a balance between two schools of thought: a highly globalized portfolio with international allocations that mirror their respective market values, or underweight foreign exposure due to the extra costs and volatility associated with the assets, writes Morningstar‘s director of personal finance Christine Benz.

When constructing a more long-term asset allocation strategy, investors will have decide how much foreign equity exposure they want.

For instance, among the so-called less is more investors, such as Jack Bogle, U.S. investors can get indirect foreign market exposure through large multi-national companies, which may also help investors avoid the extra costs and potential currency risks associated with foreign stock investments.

On the other hand, so-called global market-cap agnostics that weight international exposure based on their market value could hold up to half of their investment portfolio in international assets. For instance, the FTSE Global All Cap Index includes about a fifty-fifty U.S./foreign split [Embracing International Small-Cap ETFs]