After the remainder of the world outperformed the U.S. in 2025 , Rob Citrone forecasts extra relative weak point forward for the nation’s equities. The billionaire hedge fund supervisor mentioned he’s quick the U.S. market and lengthy equities in sure worldwide markets. In an look Tuesday on CNBC’s ” Squawk Field ,” the Discovery Capital Administration founder and portfolio supervisor defined why he thinks rising overseas markets — notably some in Latin America — have extra room for upside in 2026. A part of that’s simply the already excessive valuation of U.S. shares, he mentioned. “The U.S. trades at over a 40% premium to the remainder of the world,” Citrone mentioned. “It ought to be at a premium, however 40% is a bit extreme.” However notably regarding to him is the uncertainty concerning the return on funding firms will obtain from excessive capital expenditures, pushed primarily by investments in synthetic intelligence and information facilities. Current earnings studies from main hyperscalers alone undertaking a 70% enhance in capex spending in 2026 to $600 billion. But nearly each day a brand new inventory sector group is being hit on fears AI will disrupt their future development, elevating questions on whether or not firms will see greater returns from AI or be displaced by it. .SPX ACWX YTD line .SPX vs. ACWX year-to-date chart. “We do not know who the winners are going to be. I do not suppose all people’s going to be a winner and that is one of many issues,” he mentioned. “You see sectors and corporations, each day important changes, as a result of persons are afraid of what the long run upholds.” Citrone likes rising markets as a result of the businesses there typically are monopolies or oligopolies, which means they’ve extra safety of their very own companies and do not need to rush to beat the competitors on AI, thus being insulated from the funding’s potential dangers. His high decide is Mexico, which he says appears to be like sturdy because of its deal with strengthening ties with the U.S. and the low valuations of its firms which regularly have few opponents because of their dominance of their respective industries. Citrone added Argentina has important upside because of the prospect for additional authorities coverage reforms following a midterm election that strengthened the facility of President Javier Milei. Citrone additionally mentioned he stays quick digital asset treasury firms, together with Michael Saylor’s Technique . These firms have fallen sharply as Bitcoin has tumbled greater than 40% since October. “These treasury crypto firms have been buying and selling at huge premiums, which did not make any sense to me,” he mentioned. “I feel it is nonetheless a greater technique to quick than to quick the precise bitcoin.”