Goldman Sachs strategist Peter Oppenheimer, who accurately predicted Wall Street’s underperformance this year, expects US equities to lag for the next decade. He advised investors to diversify beyond the US as high valuations limit further gains.

Oppenheimer’s team projects the S&P 500 to deliver annual returns of 6.5% over the next 10 years — the weakest among major regions — while emerging markets are forecast to lead with 10.9% yearly gains. After a decade of dominance fueled by tech and AI enthusiasm, the S&P 500’s 16% rise this year trails the 27% advance in MSCI’s global index excluding the US.

“Diversify beyond the US, with a tilt toward emerging markets,” Oppenheimer’s team wrote, citing higher nominal GDP growth and structural reforms that favor EM, and noting that AI’s long-term benefits will be global rather than US-centric.

Emerging-market growth is expected to be driven by strong earnings in China and India. Asia excluding Japan is seen delivering 10.3% annual returns, Japan 8.2% supported by improved corporate governance, and Europe 7.1%.