A common diversification strategy involves setting the allocations between U.S. stocks and stocks domiciled in the rest of the world. Parameters used to determine this relative allocation include expected returns, expected risks (volatility of returns), stock valuations (e.g., price/earnings and price/book ratios), and currency expectations. Return, risk and valuation parameters are common diversification strategy parameters, but currency comes into the mix when investments are made outside of an investor’s home country. The perspective here provides some basic information that can be useful for making diversification decisions between U.S. stocks and those of the rest-of-the-world.