Latest news with #VXUS
Yahoo
22-05-2025
- Business
- Yahoo
2 International ETFs Drawing Massive Inflows
Despite the stunning comeback in the U.S. stock market from early April lows, investors have poured millions into international ETFs. Vanguard Total International Stock ETF VXUS and Avantis Emerging Markets Equity ETF AVEM saw solid inflows of $11.7 billion and $1.1 billion, respectively, in just one month. Investors should note that VXUS has not seen a single day of outflows in the past 52 weeks and has gathered $11.7 billion in capital in a year. This trend reflects a broader shift in investor sentiment, driven by a combination of macroeconomic factors, geopolitical developments and market dynamics. U.S. Market Volatility: The U.S. stock market is still grappling with a host of challenges, including credit downgrades, persistent inflation and trade tensions (read: Moody's Downgrades U.S. Rating: What's Next for S&P 500 ETFs?). Attractive Valuations: After more than a decade of U.S. stock market outperformance, valuations between U.S. and international stocks have reached historically wide gaps. International equities, particularly in Europe and emerging markets, are currently trading at more attractive valuations compared to their U.S. counterparts. For instance, the MSCI EAFE Index, which tracks developed markets outside the United States, has a forward P/E ratio of 14.8, nearly 20% cheaper than 18.5 for the S&P 500 markets have also shown resilience, with the MSCI Emerging Markets ex-China index surging 20% in the past month. Factors such as a weakening U.S. dollar, stabilizing Treasury yields, and signs of economic recovery in countries like China, Korea, Taiwan, and Vietnam have contributed to this Tailwinds: The weakening of the U.S. dollar has made international investments more appealing. A weaker dollar enhances the returns of foreign assets when converted back to U.S. currency, providing an additional incentive for investors to diversify Government Stimulus Abroad: Fiscal policy is another major factor. Europe has implemented fiscal stimulus measures. Germany recently unveiled a €500 billion infrastructure package aimed at bolstering economic growth, while China has ramped up fiscal support to stabilize its economy. In contrast, the United States has taken a different approach as it is grappling with inflation and fiscal challenges (read: Europe Investing Gains Wall Street Favor: Time to Jump Into ETFs?). Vanguard Total International Stock ETF (VXUS)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 8,576 stocks with key holdings in financials, industrials, technology and consumer discretionary. Japan, the United Kingdom and China are the top three AUM of $90.9 billion, Vanguard Total International Stock ETF charges 5 bps in fees per year from investors and trades in an average daily volume of 4 million Emerging Markets Equity ETF (AVEM)Avantis Emerging Markets Equity ETF invests in a broad set of companies of all market capitalizations across emerging market countries and is designed to increase expected returns by overweighting securities believed to be trading at lower valuations with higher profitability ratios. It holds a broad basket of 3,530 stocks with key holdings in financials, information technology and consumer discretionary. From a country look, China takes the largest share at 27%, followed by India (20%), Taiwan (20%) and South Korea (11%) (read: Should You Buy the Dip in India ETFs Amid Pakistan Tensions?).Avantis Emerging Markets Equity ETF has AUM of $9.7 billion and charges 33 bps in annual fees. It trades in volume of more than 1 million shares. 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 Vanguard Total International Stock ETF (VXUS): ETF Research Reports Avantis Emerging Markets Equity ETF (AVEM): ETF Research Reports This article originally published on Zacks Investment Research ( Zacks Investment Research Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
20-05-2025
- Business
- Yahoo
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, 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 | © Copyright 2025 All rights reserved
Business Mayor
18-05-2025
- Business
- Business Mayor
The market just gave investors a gift. Here's how not to blow it, according to investing experts
The stock market has come full circle from its April lows, with all of the losses suffered now recovered. For investors who long defied warnings about being over-exposed to U.S. stocks, especially with the dominant position of a handful of tech stocks in the S&P 500 , the rebound in portfolios is a good opportunity to do what many had neglected to do in the past: diversify into international equities and other asset classes. 'You got a gift from the market gods,' said David Schassler, VanEck head of multi-asset solutions, on last week's 'ETF Edge.' 'We want to see people diversify, diversify internationally and into real assets as well, specifically gold and if you're into it, also diversify into bitcoin,' he said. Some investors already got the message early in 2025, as the period from January to April saw most major markets around the globe leave U.S. stocks behind in performance. Vanguard's Total International Stock Index ETF ( VXUS ), as an example, has net inflows of over $6 billion this year, according to which places it No. 11 among all ETFs in flows this year. But to put that into perspective, Vanguard's S&P 500 ETF ( VOO ), is now over $63 billion in inflows this year. In fact, VOO is on pace to blow away the record for annual inflows it set just last year. As investors who bought the dip in U.S. stocks are rewarded, ETF experts say those who have stuck with an S&P 500-heavy tilt and didn't enjoy the drawdown experience of April should still use this opportunity to look at portfolio balance. 'If your portfolio is predominantly U.S. [stocks], we want to see you diversity in international as well as emerging markets,' Schassler said. Read More China vows to boost domestic demand in bid for 2024 recovery Investing icons of the recent past, from Warren Buffett to Jack Bogle of Vanguard Group, broadcast a message that focusing on U.S. stocks over the long-term is the best bet. Bogle, in particular, often said the S&P 500's multi-national corporate makeup delivers plenty of overseas revenue itself. But even Buffett has been lightening up on some big U.S. market positions, while adding to more of his more recent bets on Japan. 'We're not anti-U.S., but just saying if you are predominantly invested in the U.S., you probably want to invest outside as well,' Schassler said. U.S. stock valuation remains concern as investors rush back in Valuation in the S&P 500 remains a primary concern for experts who say this is a good time to make sure a portfolio is properly diversified. According to Schassler, with the recovery in stocks, the U.S. market is 'priced richly.' He added that even as recession risks have declined after the U.S.-China temporary trade truce, the risks remain higher than the historical baseline. 'We're not calling a recession, but risk is high,' he said on 'ETF Edge.' The price to earnings ratio in U.S. stocks reinforces the message that there is 'lots of value overseas,' he added. In Schassler's view, the big shift in U.S. government policy on a global basis is also a secondary catalyst for more diversification. As the world becomes more bifurcated, and countries are forced to move forward on their own and push their own growth, investors are in a backdrop that favors more growth from lower valuation international stock markets, he said. Todd Rosenbluth, head of research at VettaFi, said on 'ETF Edge' that this year has shown more investors embracing international diversification, though he added that we are 'not fully seeing it' in the market yet. He also says investors should use this moment to be mindful of the concentration within their U.S. stock holdings. 'The flows have certainly been favoring the U.S. and investors been buying the dip are being rewarded,' Rosenbluth said. 'We've seen growth equities rebound much more strongly, those tech and consumer discretionary oriented sectors,' he said. The iShares S&P 500 Growth ETF ( IVW ) is up nearly 18% in the past month, while the iShares S&P 500 Value ETF ( IVE ) is up about 8%, according to ETF Action. IVW has a P/E ratio above 33, compared to a P/E ratio of 21.5 for IVE. Rosenbluth says a good way to deal with the valuation and concentration risk within a U.S. portfolio is to invest in 'quality' stock funds, such as offerings that seek to tweek growth and value more than in the S&P 500 as a whole, such as VictoryShares' Free Cash Flow ETFs. 'We might not see this rally continue on the growth side so you want to have balance in the portfolio,' Rosenbluth said. China, India and emerging markets Both ETF experts said as global trade sentiment improves, investors should look at China and India as part of any international diversification plan. Schassler said China is aggressively stimulating its economy, and India is one of the best growth stories in the world, 'like China 20 years ago,' he said. 'Having China and India exposure makes sense,' he said. Rosenbluth said there was strong interest in China at the beginning of the year, and in ETFs such as KraneShares' CSI China Internet ETF ( KWEB ), but he described that momentum as now 'faded.' KWEB is still a good option for investors interested in China in this environment, Rosenbluth said, because it is still one of the largest of the China-focused growth-oriented ETFs, and is less likely to be negatively impacted from China tariffs. It is a 'China-only' story as opposed to a broader Chinese stock fund with exposure to multi-national businesses. KWEB is up 14% of the past month, and in the past week it saw close to $100 million in flows, compared to net outflows over $800 million during the prior three months, according to ETF Action. On India, there are multiple options for investors, including the iShares MSCI India ETF ( INDA ), as well as Van Eck's Digital India ETF (DGIN). Schassler said the structural growth story in India is the reason to invest. 'You've got a huge population, it's tech savvy, well-educated, and the government is supporting the economy, so everything lines up there for a growth story,' he said.
CNBC
18-05-2025
- Business
- CNBC
The market just gave investors a gift. Here's how not to blow it, according to investing experts
The stock market has come full circle from its April lows, with all of the losses suffered now recovered. For investors who long defied warnings about being over-exposed to U.S. stocks, especially with the dominant position of a handful of tech stocks in the S&P 500, the rebound in portfolios is a good opportunity to do what many had neglected to do in the past: diversify into international equities and other asset classes. "You got a gift from the market gods," said David Schassler, VanEck head of multi-asset solutions, on last week's "ETF Edge." "We want to see people diversify, diversify internationally and into real assets as well, specifically gold and if you're into it, also diversify into bitcoin," he said. Some investors already got the message early in 2025, as the period from January to April saw most major markets around the globe leave U.S. stocks behind in performance. Vanguard's Total International Stock Index ETF (VXUS), as an example, has net inflows of over $6 billion this year, according to which places it No. 11 among all ETFs in flows this year. But to put that into perspective, Vanguard's S&P 500 ETF (VOO), is now over $63 billion in inflows this year. In fact, VOO is on pace to blow away the record for annual inflows it set just last year. As investors who bought the dip in U.S. stocks are rewarded, ETF experts say those who have stuck with an S&P 500-heavy tilt and didn't enjoy the drawdown experience of April should still use this opportunity to look at portfolio balance. "If your portfolio is predominantly U.S. [stocks], we want to see you diversity in international as well as emerging markets," Schassler said. Investing icons of the recent past, from Warren Buffett to Jack Bogle of Vanguard Group, broadcast a message that focusing on U.S. stocks over the long-term is the best bet. Bogle, in particular, often said the S&P 500's multi-national corporate makeup delivers plenty of overseas revenue itself. But even Buffett has been lightening up on some big U.S. market positions, while adding to more of his more recent bets on Japan. "We're not anti-U.S., but just saying if you are predominantly invested in the U.S., you probably want to invest outside as well," Schassler said. Valuation in the S&P 500 remains a primary concern for experts who say this is a good time to make sure a portfolio is properly diversified. According to Schassler, with the recovery in stocks, the U.S. market is "priced richly." He added that even as recession risks have declined after the U.S.-China temporary trade truce, the risks remain higher than the historical baseline. "We're not calling a recession, but risk is high," he said on "ETF Edge." The price to earnings ratio in U.S. stocks reinforces the message that there is "lots of value overseas," he added. In Schassler's view, the big shift in U.S. government policy on a global basis is also a secondary catalyst for more diversification. As the world becomes more bifurcated, and countries are forced to move forward on their own and push their own growth, investors are in a backdrop that favors more growth from lower valuation international stock markets, he said. Todd Rosenbluth, head of research at VettaFi, said on "ETF Edge" that this year has shown more investors embracing international diversification, though he added that we are "not fully seeing it" in the market yet. He also says investors should use this moment to be mindful of the concentration with their U.S. stock holdings. "The flows have certainly been favoring the U.S. and investors been buying the dip are being rewarded," Rosenbluth said. "We've seen growth equities rebound much more strongly, those tech and consumer discretionary oriented sectors," he said. The iShares S&P 500 Growth ETF (IVW) is up nearly 18% in the past month, while the iShares S&P 500 Value ETF (IVE) is up about 8%, according to ETF Action. Rosenbluth says a good way to deal with the valuation and concentration risk within a U.S. portfolio is to invest in a "quality" stock funds, such as VictoryShares' Free Cash Flow ETFs. "We might not see this rally continue on the growth side so you want to have balance in the portfolio," Rosenbluth said. Both ETF experts said as global trade sentiment improves, investors should look at China and India as part of any international diversification plan. Schassler said China is aggressively stimulating its economy, and India is one of the best growth stories in the world "like China 20 years ago," he said. "Having China and India exposure makes sense," he said. Rosenbluth said there was strong interest in China at the beginning of the year, and in ETFs such as KraneShares' CSI China Internet ETF (KWEB), but he described that momentum as now "faded." KWEB is still a good option for investors interested in China in this environment, Rosenbluth said, because it is still one of the largest of the China-focused growth-oriented ETFs, and is less likely to be negatively impacted from China tariffs. It is a "China-only" story as opposed to a broader Chinese stock fund with exposure to multi-national businesses. KWEB is up 14% of the past month, and in the past week it saw close to $100 million in flows, compared to net outflows over $800 million during the prior three months, according to ETF Action. On India, there are multiple options for investors, including the iShares MSCI India ETF (INDA), as well as Van Eck's Digital India ETF (DGIN). Schassler said the structural growth story in India is the reason to invest. "You've got a huge population, it's tech savvy, well-educated, and the government is supporting the economy, so everything lines up there for a growth story," he said. Disclaimer
Forbes
17-04-2025
- Business
- Forbes
VEU Vs. VXUS: Which Of These Vanguard ETFs Is Best For Those Looking To Diversify?
Both VEU and VXUS are excellent international ETFs with unique benefits depending on your investment ... More priorities and existing portfolio composition. Investor concerns over the breakout of a global tariff war have eased after the White House announced a 90-day pause on new duties and negotiations with over 75 countries on trade deals. If successful, these negotiations could prevent trade reduction, supply-chain disruptions, and a rise in consumer prices. These negotiations underscore why international diversification is essential to reduce reliance on a single market. For investors seeking to diversify their portfolios with an international ETF, VEU and VXUS, both offered by Vanguard, are top contenders. These funds both offer international exposure, void of U.S. holdings, but they differ in their strategy, national exposure and number of holdings. By understanding the key differences between these funds and in which situations either would be preferable, investors can choose the right fund for their portfolio. In this guide, you'll learn how VEU and VXUS differ by market exposure, expense ratio, holdings and more, as well as how to make the final determination of which fund is right for you. VEU and VXUS are both ETFs made up of international stock holdings from Vanguard, the firm known for revolutionizing low-cost investing with Vanguard index funds, intended to offer investors exposure to non-U.S. stocks. Both funds can be used to diversify your portfolio with international stocks, each with unique strategies to accomplish this goal. VEU tracks the FTSE All-World ex-US Index which provides broad exposure to developed and emerging markets outside of the United States. VEU has over 3,000 holdings from Europe, Asia and Latin America providing significant exposure to international markets. VEU makes it easy to gain international exposure while avoiding overlap with U.S. stocks, including the best stocks for 2025. This ETF is ideal for investors seeking broad diversification in international markets with a focus on large and mid-cap stocks. VEU is more focused on developed markets than emerging markets and its large positions include Taiwan Semiconductor, Tencent, SAP, Alibaba, and Novo Nordisk. VEU has a low expense ratio of just 0.04% and net assets of $59.54B. VXUS tracks the FTSE Global All Cap ex-US Index which includes small, mid and large-cap stocks from across the world with the exception of the United States. This ETF provides broader exposure to international stocks than VEU with more exposure to small-cap stocks and emerging markets than VEU. With holdings of over 7,000 stocks, VXUS is ideal for investors seeking more granular market exposure. VXUS' primary holdings overlap with VEU including Taiwan Semiconductor, Tencent, SAP, Alibaba, and Novo Nordisk but with slightly lower percentage holdings in these than VEU as it has more total holdings. Like VEU, VXUS' primary sector holdings include Financial Service, Industrials, Technology, Consumer Cyclical and Healthcare. VXUS has higher net assets than VEU of $455.42B and a slightly higher expense ratio of 0.05% VEU and VXUS both provide international exposure but they differ in their strategies and holdings. VEU's holdings are concentrated in mid and large-cap stocks in developed and emerging markets. This ETF excludes U.S. stocks and also has fewer holdings. VXUS provides more broad exposure with small-cap holdings in addition to mid and large-cap stocks. This fund composition provides more diversification to investors and is ideal for investors seeking more complete international exposure. While its inclusion of small-cap stocks can increase volatility, it also can offer greater potential for growth. Datawrapper link: VEU has holdings of over 3,000 stocks from more than 45 countries with the exception of the U.S. This fund has more concentrated holdings in developed markets with heavy weightings in Europe and Asia. While it does provide emerging market exposure, it provides less than VXUS. VXUS has holdings of over 7,000 stocks with broader exposure across emerging markets than VEU with more diversity in market capitalizations of its holdings. These attributes make VXUS more ideal for investors seeking full international exposure. In light of recent tariff news, VEU's limited allocation to small cap stocks, many in emerging markets, may serve as a risk if trade deals aren't reached with specific trading partners like the EU for example. VXUS' broader inclusion of small caps and emerging market holdings may reduce the effect of any one region's tariffs. VEU and VXUS both boast low expense ratios with VEU charging just a 0.04% expense ratio and VXUS charging 0.05%. While both funds are cost-effective, VEU's marginally lower cost may appeal to more investors seeking to minimize fees. For investors seeking broader diversification, VXUS' higher fee may be worthwhile. VEU maintains lower trading volume than VXUS which may result in wider bid-ask spreads. Long-term investors won't be as affected by this difference but it is relevant for traders who need higher liquidity from their ETFs. VXUS offers greater liquidity and higher trading volume than VEU, making it also more ideal for institutional investors. Both VEU and VXUS offer attractive dividend yields with VXUS edging out VEU with a 3.15% yield versus 3.03%. For investors seeking more income from funds in their portfolio, VXUS may be preferable. Dividend yields can change year to year due to payouts from holdings. VEU and VXUS have had similar performance over the last 10 years due to similar holdings and primary exposure to the same markets. Despite this common trend, VEU has outperformed VXUS in both the short and longer term. VEU's 1-year return is 7.02% while VXUS' 1-year return is 6.62%. Likewise, VEU's 3-year return is 5.00% while VXUS returned 4.58%. In comparison, VOO, Vanguard's S&P 500 ETF had a 1-year return of 6.93% and a 3-year return of 8.81%. Despite VOO's outperformance in the 3-year return, VEU and VXUS can offer valuable diversification for domestic-heavy portfolios. For more information on two of the primary U.S. ETFs offered by Vanguard to consider, read this helpful guide: VTI vs VOO. Investors should choose VEU or VXUS based on their investing objectives, portfolio composition and risk tolerance. If you want a fund with a history of higher performance and more concentration in developed markets, VEU would be a better fit. If you prefer broader international exposure and more diversification in cap size, VXUS is a better fit. You want a fund with more focus in large and mid-cap stocks but without U.S. exposure. VEU is also a better fit if you wish to invest in larger, established international stocks with a lower expense ratio and a better history of performance. VEU could also be the right fund for you if you wish for lower volatility in the portfolio and less portfolio churn due to less exposure to small-cap stocks and stocks from developing nations. You want broader international market exposure with more small-cap and emerging market stocks. For investors seeking more total-market exposure with a higher dividend yield, VXUS is an ideal fit. If you're also seeking more liquidity in your fund and slightly tighter bid-ask spreads, choose VXUS. VXUS may also be a better fit for investors who want more diversification in their international fund, have a longer time horizon, and can tolerate more volatility for potentially higher long-term gains. Bottom Line Both VEU and VXUS are excellent international ETFs with unique benefits depending on your investment priorities and existing portfolio composition. VXUS is a superior fit for investors seeking broad market exposure and higher yield. VEU is a better fit for investors who are conscious of fees, want to invest primarily in international blue-chip stocks, and prefer a history of higher performance. Ultimately, both ETFs provide strong international exposure so your selection will be determined by how much you weigh the marginal differences in these ETF's features. Yes, VXUS includes holdings from emerging markets including China, Brazil and India. VXUS offers slightly better long-term growth potential due to small-cap and emerging market stocks being included in its index. Both VEU and VXUS are tax efficient, as ETFs are more tax efficient than index funds. Both ETFs are subject to foreign tax withholding if you're a U.S. investor. It would be unnecessary to hold both VEU and VXUS as these ETFs have significant overlap in their holdings and purpose so it would be more efficient to hold just one.
