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The global stock market has been surging this year as risk appetite returns with improving market sentiment. Though U.S. stocks are showering strong gains to investors, the international market is not behind.
This is especially true as Vanguard FTSE All-World ex-US ETF (VEU - Free Report) targeting the international equity market has gained about 8.3% over the past three months compared with growth of 5.6% for iShares MSCI ACWI ETF (ACWI - Free Report) , which targets the global stock market, including the United States.
The solid trend is likely to continue and investors could tap this opportune moment with some popular international ETFs. These include Vanguard Total International Stock ETF (VXUS - Free Report) , Vanguard FTSE All-World ex-US ETF (VEU - Free Report) , SPDR Portfolio Developed World ex-US ETF (SPDW - Free Report) , iShares Core MSCI International Developed Markets ETF (IDEV - Free Report) , and Schwab Fundamental International Large Company Index ETF (FNDF - Free Report) . The funds have a Zacks ETF Rank #3 (Hold).
The outperformance came on the back of easing concerns about international economies. Europe has experienced a warmer-than-expected winter that helped the region avoid a feared energy crisis. Additionally, the reopening of China after the restrictions eased has not only infused optimism in the world’s second-largest economy but will power the economies across the globe (read: Winning Europe ETFs to Start 2023).
A weaker dollar helped to boost returns for foreign stocks. The U.S. dollar against a basket of currencies has declined in recent months and is likely to be under pressure on Fed actions. The latest comment from Federal Reserve Chair Jerome Powell that inflation has started easing has spurred bets that the central bank could continue slowing its interest rate hike campaign.
At the latest meeting early this month, the Fed lifted its benchmark interest rate by 0.25 percentage points to 4.5-4.75% and signaled that it could be closer to pausing its rate hike plan. This will attract more foreign inflows, raising the appeal for international equities (read: Fed Hike Slows Down But Set to Remain Steady: ETFs to Gain).
Further, international stocks have become most attractively valued after years of underperformance. For most of last year, investors shunned these stocks on risks from Russia’s war with Ukraine, a potential energy crisis in Europe, turmoil in the U.K. bond market, China’s zero-Covid policy, regulatory pressure from Beijing and weakness in foreign currencies.
Vanguard Total International Stock ETF offers exposure to companies located in developed and emerging markets, excluding the United States. It follows the FTSE Global All Cap ex US Index and holds a broad basket of 7913 stocks with key holdings in financials, industrials, consumer discretionary and technology. Japan, the United Kingdom and China are the top three countries.
With AUM of $54.4 billion, Vanguard Total International Stock ETF charges 7 bps in fees per year from investors and trades in an average daily volume 3.6 million shares
Vanguard FTSE All-World ex-US Index Fund (VEU - Free Report)
Vanguard FTSE All-World ex-US Index Fund targets companies in developed and emerging markets worldwide and tracks the FTSE All-World ex-US Index. It has 3708 stocks in its basket, with key holdings in financials, industrials, consumer discretionary and technology. Japan, the United Kingdom and China are the top three countries (read: Why Investors are Pouring Money into International ETFs).
Vanguard FTSE All-World ex-US Index Fund has AUM of $34.8 billion and charges 7 bps in annual fees. It trades in an average daily volume 4 million shares.
SPDR Portfolio Developed World ex-US ETF (SPDW - Free Report)
SPDR Portfolio Developed World ex-US ETF offers broad exposure to developed international equities outside the United States by tracking the S&P Developed Ex-U.S. BMI Index. It has a well-diversified basket of 2542 stocks with key holdings in financials, industrials, consumer discretionary and healthcare that account for double-digit exposure each. Japan, the United Kingdom and Canada are the top three countries.
SPDR Portfolio Developed World ex-US ETF has AUM of $15.1 billion and trades in volume of 3.7 million shares a day on average. The product charges 4 bps in annual fees.
iShares Core MSCI International Developed Markets ETF (IDEV - Free Report)
iShares Core MSCI International Developed Markets ETF offers low-cost exposure to global developed markets outside the United States. It follows the MSCI WORLD ex USA IMI Index, holding 2,294 stocks in its basket. Japan, the United Kingdom and Canada make up the top three countries while financials, industrials and consumer discretionary are the top three sectors.
iShares Core MSCI International Developed Markets ETF has amassed $10.4 billion and trades in an average daily volume of 1.2 million shares. It charges 4 bps in fees per year.
Schwab Fundamental International Large Company Index ETF (FNDF - Free Report)
Schwab Fundamental International Large Company Index ETF provides exposure to 958 largest developed international companies based on fundamental measures by tracking the Russell RAFI Developed ex-US Large Company Index. The product is tilted toward Japanese firms at 26.6% while the United Kingdom accounts for 15.5%. In terms of sectors, financials, industrials, consumer discretionary and materials make up for double-digit allocation each.
Schwab Fundamental International Large Company Index ETF has AUM of $9.3 million and trades in a volume of 1 million shares a day on average. It charges 25 bps in fees per year.
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5 International ETFs Worth Considering This Year
The global stock market has been surging this year as risk appetite returns with improving market sentiment. Though U.S. stocks are showering strong gains to investors, the international market is not behind.
This is especially true as Vanguard FTSE All-World ex-US ETF (VEU - Free Report) targeting the international equity market has gained about 8.3% over the past three months compared with growth of 5.6% for iShares MSCI ACWI ETF (ACWI - Free Report) , which targets the global stock market, including the United States.
The solid trend is likely to continue and investors could tap this opportune moment with some popular international ETFs. These include Vanguard Total International Stock ETF (VXUS - Free Report) , Vanguard FTSE All-World ex-US ETF (VEU - Free Report) , SPDR Portfolio Developed World ex-US ETF (SPDW - Free Report) , iShares Core MSCI International Developed Markets ETF (IDEV - Free Report) , and Schwab Fundamental International Large Company Index ETF (FNDF - Free Report) . The funds have a Zacks ETF Rank #3 (Hold).
The outperformance came on the back of easing concerns about international economies. Europe has experienced a warmer-than-expected winter that helped the region avoid a feared energy crisis. Additionally, the reopening of China after the restrictions eased has not only infused optimism in the world’s second-largest economy but will power the economies across the globe (read: Winning Europe ETFs to Start 2023).
A weaker dollar helped to boost returns for foreign stocks. The U.S. dollar against a basket of currencies has declined in recent months and is likely to be under pressure on Fed actions. The latest comment from Federal Reserve Chair Jerome Powell that inflation has started easing has spurred bets that the central bank could continue slowing its interest rate hike campaign.
At the latest meeting early this month, the Fed lifted its benchmark interest rate by 0.25 percentage points to 4.5-4.75% and signaled that it could be closer to pausing its rate hike plan. This will attract more foreign inflows, raising the appeal for international equities (read: Fed Hike Slows Down But Set to Remain Steady: ETFs to Gain).
Further, international stocks have become most attractively valued after years of underperformance. For most of last year, investors shunned these stocks on risks from Russia’s war with Ukraine, a potential energy crisis in Europe, turmoil in the U.K. bond market, China’s zero-Covid policy, regulatory pressure from Beijing and weakness in foreign currencies.
Vanguard Total International Stock ETF (VXUS - Free Report)
Vanguard Total International Stock ETF offers exposure to companies located in developed and emerging markets, excluding the United States. It follows the FTSE Global All Cap ex US Index and holds a broad basket of 7913 stocks with key holdings in financials, industrials, consumer discretionary and technology. Japan, the United Kingdom and China are the top three countries.
With AUM of $54.4 billion, Vanguard Total International Stock ETF charges 7 bps in fees per year from investors and trades in an average daily volume 3.6 million shares
Vanguard FTSE All-World ex-US Index Fund (VEU - Free Report)
Vanguard FTSE All-World ex-US Index Fund targets companies in developed and emerging markets worldwide and tracks the FTSE All-World ex-US Index. It has 3708 stocks in its basket, with key holdings in financials, industrials, consumer discretionary and technology. Japan, the United Kingdom and China are the top three countries (read: Why Investors are Pouring Money into International ETFs).
Vanguard FTSE All-World ex-US Index Fund has AUM of $34.8 billion and charges 7 bps in annual fees. It trades in an average daily volume 4 million shares.
SPDR Portfolio Developed World ex-US ETF (SPDW - Free Report)
SPDR Portfolio Developed World ex-US ETF offers broad exposure to developed international equities outside the United States by tracking the S&P Developed Ex-U.S. BMI Index. It has a well-diversified basket of 2542 stocks with key holdings in financials, industrials, consumer discretionary and healthcare that account for double-digit exposure each. Japan, the United Kingdom and Canada are the top three countries.
SPDR Portfolio Developed World ex-US ETF has AUM of $15.1 billion and trades in volume of 3.7 million shares a day on average. The product charges 4 bps in annual fees.
iShares Core MSCI International Developed Markets ETF (IDEV - Free Report)
iShares Core MSCI International Developed Markets ETF offers low-cost exposure to global developed markets outside the United States. It follows the MSCI WORLD ex USA IMI Index, holding 2,294 stocks in its basket. Japan, the United Kingdom and Canada make up the top three countries while financials, industrials and consumer discretionary are the top three sectors.
iShares Core MSCI International Developed Markets ETF has amassed $10.4 billion and trades in an average daily volume of 1.2 million shares. It charges 4 bps in fees per year.
Schwab Fundamental International Large Company Index ETF (FNDF - Free Report)
Schwab Fundamental International Large Company Index ETF provides exposure to 958 largest developed international companies based on fundamental measures by tracking the Russell RAFI Developed ex-US Large Company Index. The product is tilted toward Japanese firms at 26.6% while the United Kingdom accounts for 15.5%. In terms of sectors, financials, industrials, consumer discretionary and materials make up for double-digit allocation each.
Schwab Fundamental International Large Company Index ETF has AUM of $9.3 million and trades in a volume of 1 million shares a day on average. It charges 25 bps in fees per year.