Money Flows Into International ETFs VXUS AVEM
As U.S. markets swing and investors grapple with credit downgrades, a trade war and inflation fears, billions of dollars are flowing into ETFs that invest in international and emerging markets companies.
The largest ex-U.S. international exchange-traded fund, the $90.5 billion Vanguard Total International Stock ETF (VXUS), has of late pulled off an impressive feat: It has not seen a single day of outflows over the past 52 weeks. It's pulled in $11.7 billion over that period. Over the past month, VXUS has had $1.5 billion of inflows, and its last day of outflows was in February 2023.
Emerging markets ETFs are also being snapped up by investors in some cases. The $9.7 billion Avantis Emerging Markets Equity ETF (AVEM) has over the past month pulled in $1.1 billion.
Investors have bid up international ETFs this year as some believe the Trump administration's tariff war will force overseas companies to build domestic industries such as defense. VXUS has gained 14% this year compared with a 1.8% gain on the Vanguard S&P 500 ETF (VOO). Still, VOO has jumped 13% over the past month, topping the 8.8% increase for VXUS.
AVEM's 10% gain this year has also topped VOO's return, while its one-month gain of 11% trails that of the big S&P 500 fund. Investors may be drawn to the potential for rising valuations in the ETF, with its average portfolio price/earnings ratio of 10.2, etf.com Research Lead Kent Thune, CFP, said.
'Looking under the hood of AVEM, the low average portfolio P/E is extremely attractive compared to the S&P 500's valuation, which is more than double that,' Thune said. Investors are also drawn to the fund's top holdings, which include Taiwan Semiconductor Manufacturing Co. (TSM), Alibaba Group Holding (BABA) and Tencent Holdings (TCEHY), he said.
VXUS Net Fund Flows—Source: FactSet
Still, VXUS may be seeing big inflows due to its status as the "workhorse" international ETF and its inclusion in robo-advisor and model portfolio schemes at Vanguard, said Daniel Sotiroff, CFA, Morningstar Direct senior manager research analyst.
He added that while VXUS and AVEM are outperforming VOO, mutual fund and ETF flows still favor U.S. investments. He said April mutual fund and ETF inflows of $2.9 billion into the foreign and large blend category were lower than typical, and overall emerging markets ETFs and mutual funds had outflows of $3.6 billion.Permalink | © Copyright 2025 etf.com. All rights reserved
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Los Angeles Times
28 minutes ago
- Los Angeles Times
US stocks drift and Chinese markets rise as trade talks start between the world's largest economies
NEW YORK — U.S. stocks drifted through a quiet Monday as the world's two largest economies began talks on trade that could help avoid a recession. The Standard & Poor's 500 edged up by 0.1% and is within 2.3% of its record, which was set in February. The Dow Jones Industrial Average slipped by 1 point, which is well below 0.1%, and the Nasdaq composite added 0.3%. Officials from the United States and China met in London to talk about a range of different disputes that are separating them. The hope is that they can eventually reach a deal that will lower each's punishing level of tariffs against the other, which are currently on pause, so that the flow of everything from tiny tech gadgets to enormous machinery can continue. Hopes that President Trump will lower his tariffs after reaching such trade deals with countries around the world have been among the main reasons the S&P 500 has rallied so furiously since dropping roughly 20% from its record two months ago. It's back above where it was when Trump shocked financial markets in April with his wide-ranging tariff announcement on what he called 'Liberation Day.' This may be the shortest sell-off following a shock of heightened volatility on record, according to Parag Thatte, Binky Chadha and other strategists at Deutsche Bank. Typically, stocks take around two months to bottom following a spike in volatility and then another four to five months to recover their losses. This time around, stocks have basically made a round trip in less than two months. But nothing is assured, of course, and that helped keep trading relatively quiet on Wall Street Monday. Some of the market's biggest moves came from the announcement of big buyout deals. Qualcomm rallied 4.1% after saying it agreed to buy Alphawave Semi in a deal valued at $2.4 billion. IonQ, meanwhile, rose 2.7% after the quantum computing and networking company said it agreed to purchase Oxford Ionics for nearly $1.08 billion. On the losing side of Wall Street was Warner Bros. Discovery, which flipped from a big early gain to a loss of 3% after saying it would split into two companies. One will get Warner Bros. Television, HBO Max and other studio brands, while the other will hold onto CNN, TNT Sports and other entertainment, sports and news television brands around the world, along with some digital products. Tesla recovered some of its sharp, recent drop. The electric vehicle company tumbled last week as Elon Musk's relationship with Trump broke apart, and it rose 4.6% Monday after flipping between gains and losses earlier in the day. The frayed relationship could end up damaging Musk's other companies that get contracts from the U.S. government, such as SpaceX. Rocket Lab, a space company that could pick up business at SpaceX's expense, rose 2.5%. All told, the S&P 500 rose 5.52 points to 6,005.88. The Dow Jones Industrial Average slipped 1.11 to 42,761.76, and the Nasdaq composite rose 61.28 to 19,591.24. In stock markets abroad, indexes were modestly lower in Europe after rising across much of Asia. Chinese markets climbed even though the government reported that exports slowed in May, growing 4.8% from a year earlier after jumping more than 8% in April. China also reported that consumer prices fell 0.1% in May from a year earlier, marking the fourth consecutive month of deflation. Stocks rallied 1.6% in Hong Kong and rose 0.4% in Shanghai. In the bond market, the yield on the 10-year Treasury eased to 4.48% from 4.51% late Friday. It fell after a survey by the Federal Reserve Bank of New York found that consumers' expectations for coming inflation eased a bit in May. That provides some relief for the Fed, which has been keeping its main interest rate steady as it waits to see how much Trump's tariffs will raise inflation and how much they will hurt the economy. A persistent increase in expectations for inflation among U.S. households could drive behavior that creates a vicious cycle that only worsens inflation. Economists expect a report coming on Wednesday to show inflation across the country accelerated last month to 2.5% from 2.3%. Choe writes for the Associated Press.
Yahoo
40 minutes ago
- Yahoo
Stock market today: Dow, S&P 500, Nasdaq futures trade flat ahead of next round of US-China talks
US stock futures traded flat as investors anticipated the second day of renewed trade talks between the US and China after an upbeat initial meeting. Futures attached to the Dow Jones Industrial Average (YM=F), the benchmark S&P 500 (ES=F), and the tech-heavy Nasdaq 100 (NQ=F) hovered around baseline. Stocks edged higher on Monday after Trump officials suggested that a first round of trade talks with China in London had been productive. Treasury Secretary Scott Bessent said it was a "good meeting," while President Trump cautioned that while "China's not easy," he received "good reports." Read more: The latest on Trump's tariffs Representatives for the countries are set to reconvene Tuesday at 10 a.m. in the British capital and are expected to focus negotiations on rare earths and tech. Investors are eager for tensions between the two trading partners to resolve as the risks to global economies remain high. Next, investors are looking forward to the release of the May Consumer Price Index report (CPI) on Wednesday. The report will offer fresh insight into the state of inflation amid Trump's evolving trade policy. Analysts expect to see the prices increased in May.
Yahoo
42 minutes ago
- Yahoo
Penske Automotive (PAG) Could Be a Great Choice
All investors love getting big returns from their portfolio, whether it's through stocks, bonds, ETFs, or other types of securities. But for income investors, generating consistent cash flow from each of your liquid investments is your primary focus. While cash flow can come from bond interest or interest from other types of investments, income investors hone in on dividends. A dividend is the distribution of a company's earnings paid out to shareholders; it's often viewed by its dividend yield, a metric that measures a dividend as a percent of the current stock price. Many academic studies show that dividends make up large portions of long-term returns, and in many cases, dividend contributions surpass one-third of total returns. Penske Automotive (PAG) is headquartered in Bloomfield Hills, and is in the Retail-Wholesale sector. The stock has seen a price change of 8.1% since the start of the year. The auto dealership chain is currently shelling out a dividend of $1.26 per share, with a dividend yield of 3.06%. This compares to the Automotive - Retail and Whole Sales industry's yield of 0.24% and the S&P 500's yield of 1.53%. In terms of dividend growth, the company's current annualized dividend of $5.04 is up 23.2% from last year. Over the last 5 years, Penske Automotive has increased its dividend 5 times on a year-over-year basis for an average annual increase of 30.89%. Looking ahead, future dividend growth will be dependent on earnings growth and payout ratio, which is the proportion of a company's annual earnings per share that it pays out as a dividend. Right now, Penske's payout ratio is 35%, which means it paid out 35% of its trailing 12-month EPS as dividend. Looking at this fiscal year, PAG expects solid earnings growth. The Zacks Consensus Estimate for 2025 is $13.99 per share, representing a year-over-year earnings growth rate of 1.82%. From greatly improving stock investing profits and reducing overall portfolio risk to providing tax advantages, investors like dividends for a variety of different reasons. It's important to keep in mind that not all companies provide a quarterly payout. Big, established firms that have more secure profits are often seen as the best dividend options, but it's fairly uncommon to see high-growth businesses or tech start-ups offer their stockholders a dividend. During periods of rising interest rates, income investors must be mindful that high-yielding stocks tend to struggle. With that in mind, PAG is a compelling investment opportunity. Not only is it a strong dividend play, but the stock currently sits at a Zacks Rank of 3 (Hold). Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Penske Automotive Group, Inc. (PAG) : Free Stock Analysis Report This article originally published on Zacks Investment Research ( Zacks Investment Research
