For years, the US economy pushed ahead at a tepid pace, quantitative easing reigned, and US stocks lacked competition from other assets. But now that story is changing, says Charles Schwab’s Liz Ann Sonders.

“The US economy is expanding in a self-sustaining fashion, the Fed is looking toward tightening, and the options outside of the United States are becoming more attractive in our view,” Sonders, along with Brad Sorensen and Jeffrey Kleintop, writes in commentary on Schwab’s website. “What does this mean for investors?  First, we are not turning bearish on US stocks, but believe that gains could be harder to come by, accompanied by heightened volatility.  Stocks typically like to climb a ‘wall of worry’ and expectations for the US economy are higher than they have been in several years; meaning a relatively low ‘wall’ for the time being.  Second, for investors who have remained well-diversified both by sector and asset class (globally), there’s likely not much to do except stay the course.  But for those  investors who have let their portfolios tilt heavily toward US equities, we believe now would be a good time to create a more balanced portfolio by adding some international equity exposure.”

The trio says those seeking global diversification should consider showing a preference for emerging markets. They also say that, despite Greece’s woes, Europe is slowly improving, and they examine some very positive developments in the housing market.