Latest news with #VanguardInternationalHighDividendYieldETF
Yahoo
29-05-2025
- Business
- Yahoo
Why I Own These 9 Vanguard ETFs
I use nine Vanguard ETFs across three portfolios with different investment objectives. These funds provide exposure to stocks, bonds, real estate, and international markets. The average expense ratio across all holdings is just 0.08%. These 10 stocks could mint the next wave of millionaires › While many investors succeed with a simple two-fund portfolio giving them ownership of a lot of stocks -- perhaps just the Vanguard S&P 500 ETF (NYSEMKT: VOO) and Vanguard Total Bond Market ETF (NASDAQ: BND) -- I've taken a more nuanced approach. My strategy involves three distinct portfolios, each designed with specific goals: aggressive growth, retirement income, and a balanced blend that encompasses multiple asset classes. Throughout these portfolios, I leverage nine carefully selected Vanguard exchange-traded funds (ETFs). Each serves a unique purpose, from capturing technology sector growth to generating steady dividend income. Here's why I own each one. The Vanguard S&P 500 ETF sits at the heart of my blended portfolio, tracking the 500 largest U.S. companies. With its microscopic 0.03% expense ratio and current yield of 1.3%, this fund provides instant diversification across sectors at virtually no cost. Since its inception, the fund has delivered approximately 13.8% average annual returns. What makes this fund essential isn't just its performance -- it's the stability it brings. By holding America's corporate giants, including Apple, Microsoft, and Berkshire Hathaway, this ETF serves as my portfolio's bedrock. The beauty lies in its simplicity: One purchase gives me exposure to 500 companies representing roughly 80% of the U.S. stock market's value. While the S&P 500 fund provides broad market exposure, the Vanguard S&P 500 Growth ETF (NYSEMKT: VOOG) concentrates on growth stocks within the S&P 500. This fund screens for companies with strong sales growth, earnings momentum, and price appreciation potential. With a still-reasonable 0.07% expense ratio, it offers targeted growth exposure without breaking the bank. The fund has outperformed the broader S&P 500 over the prior 10 years, delivering approximately 15% average annual returns since its inception. I hold the Vanguard S&P 500 Growth ETF in my growth portfolio to capture additional upside during bull markets. Diversification shouldn't stop at U.S. borders. The Vanguard International High Dividend Yield ETF (NASDAQ: VYMI) provides exposure to high-yielding stocks from developed and emerging markets outside the United States. Currently yielding around 4.3%, it offers a significantly higher yield than most domestic, dividend-focused funds, while offering geographic diversification. With holdings spanning over 1,500 international stocks and an expense ratio of 0.17%, the Vanguard International High Dividend Yield ETF adds both income and international exposure to my blended and growth portfolios. It helps reduce home country bias while capturing dividend income from established global companies. Technology drives modern economic growth, and the Vanguard Information Technology ETF (NYSEMKT: VGT) provides concentrated exposure to this crucial sector. Holding companies across software, hardware, semiconductors, and IT services, this fund has delivered exceptional performance with approximately 18% average annual returns over the prior 10 years. Despite its 0.09% expense ratio, the Vanguard Information Technology ETF remains cost-effective compared to actively managed technology funds. I maintain this position in my growth portfolio, recognizing that while sector concentration increases risk, the technology sector's unparalleled growth potential justifies the allocation. Real estate offers both income and diversification benefits. The Vanguard Real Estate ETF (NYSEMKT: VNQ) provides exposure to real estate investment trusts (REITs), which own and operate income-producing properties. I hold this fund in my retirement income portfolio primarily for its substantial dividend yield of 4.1%. On the performance side of the ledger, this Vanguard ETF has delivered approximately 5.2% average annual returns over the prior 10 years. The Vanguard Real Estate ETF also sports a rock-bottom expense ratio of 0.13%, compared to an industry average of 1.15%. Though more volatile than bonds, real estate provides crucial inflation protection and moves independently from stocks and bonds, making this ETF a valuable portfolio diversifier. Emerging markets represent tomorrow's economic powerhouses. The Vanguard FTSE Emerging Markets ETF (NYSEMKT: VWO) provides exposure to nearly 6,000 stocks across developing economies like China, India, and Brazil. With an incredibly low 0.07% expense ratio, the Vanguard FTSE Emerging Markets ETF offers cost-effective access to high-growth potential regions. While volatility remains higher than in developed markets, the fund has delivered approximately 3.3% average annual returns over the prior 10 years. That's not market-beating, but it is a steady gain in a space that holds tremendous long-term potential. I hold the Vanguard FTSE Emerging Markets ETF in my growth portfolio, accepting its above-average volatility and long-term investing thesis. The Vanguard Small-Cap ETF (NYSEMKT: VB) provides exposure to over 1,300 smaller U.S. companies for just a 0.05% expense ratio. While small companies have historically outperformed large ones over very long periods, this hasn't been the case recently. The fund has delivered approximately 7.6% average annual returns over the prior 10 years, significantly trailing the S&P 500's performance. I still hold the Vanguard Small-Cap ETF in my growth portfolio because market cycles rotate. Small caps tend to outperform coming out of recessions and during certain economic conditions. After nearly two decades of large-cap dominance, I'm positioning for potential mean reversion while accepting the higher volatility that comes with smaller companies. Every portfolio needs ballast, and the Vanguard Total Bond Market ETF provides it. This fund holds thousands of U.S. investment-grade bonds, including government, corporate, and mortgage-backed securities. Currently yielding 4.5% with a 0.03% expense ratio, the ETF offers income and stability at minimal cost. I hold the Vanguard Total Bond Market ETF across all three portfolios, adjusting allocations based on each portfolio's objectives. While bond returns have faced headwinds from rising rates, this ETF remains crucial for managing portfolio volatility and providing steady income. Complementing the domestic bond fund, the Vanguard Total International Bond ETF (NASDAQ: BNDX) provides exposure to investment-grade bonds from developed and emerging markets outside the United States. With currency hedging to minimize exchange rate risk, this fund currently yields 3% and sports a reasonable 0.07% expense ratio. The Vanguard Total International Bond ETF enhances portfolio diversification by adding international fixed income exposure. I hold it across all portfolios to reduce concentration risk and potentially benefit from different interest rate cycles globally. These nine ETFs work together to create diversified exposure across asset classes, geographies, and market capitalizations. The average expense ratio across all holdings comes to just 0.08% -- a fraction of what most mutual funds charge. Remember, the best portfolio is one you'll stick with through market cycles. Whether you prefer the simplicity of a two-fund portfolio or the granularity of my nine-fund approach, Vanguard's low-cost ETFs provide the building blocks for long-term investment success. Ever feel like you missed the boat in buying the most successful stocks? Then you'll want to hear this. On rare occasions, our expert team of analysts issues a 'Double Down' stock recommendation for companies that they think are about to pop. If you're worried you've already missed your chance to invest, now is the best time to buy before it's too late. And the numbers speak for themselves: Nvidia: if you invested $1,000 when we doubled down in 2009, you'd have $351,386!* Apple: if you invested $1,000 when we doubled down in 2008, you'd have $38,008!* Netflix: if you invested $1,000 when we doubled down in 2004, you'd have $653,389!* Right now, we're issuing 'Double Down' alerts for three incredible companies, available when you join , and there may not be another chance like this anytime soon.*Stock Advisor returns as of May 19, 2025 George Budwell has positions in Apple, Berkshire Hathaway, Microsoft, Vanguard Admiral Funds-Vanguard S&P 500 Growth ETF, Vanguard Charlotte Funds-Vanguard Total International Bond ETF, Vanguard Index Funds-Vanguard Small-Cap ETF, Vanguard Information Technology ETF, Vanguard International Equity Index Funds-Vanguard Ftse Emerging Markets ETF, Vanguard International High Dividend Yield ETF, Vanguard Real Estate ETF, Vanguard S&P 500 ETF, and Vanguard Total Bond Market ETF. The Motley Fool has positions in and recommends Apple, Berkshire Hathaway, Microsoft, Vanguard Index Funds-Vanguard Small-Cap ETF, Vanguard International Equity Index Funds-Vanguard Ftse Emerging Markets ETF, Vanguard Real Estate ETF, Vanguard S&P 500 ETF, and Vanguard Total Bond Market ETF. The Motley Fool recommends the following options: long January 2026 $395 calls on Microsoft and short January 2026 $405 calls on Microsoft. The Motley Fool has a disclosure policy. Why I Own These 9 Vanguard ETFs was originally published by The Motley Fool 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
23-05-2025
- Business
- Yahoo
Building a Passive Income Stream: 3 Top Dividend ETFs for Long-Term Returns
The Vanguard Dividend Appreciation ETF isn't the highest-paying income ETF, but there's a lot to like about it. The Vanguard International High Dividend Yield ETF has an excellent yield and cheap valuation. The Vanguard Real Estate ETF could be a big winner as interest rates fall. 10 stocks we like better than Vanguard Dividend Appreciation ETF › There are dozens of excellent low-cost index funds that pay dividends and could be great choices for long-term investors. However, a few stand out as particularly good combinations of income, long-term total return potential, and truly passive set-it-and-forget-it qualities. Most of my favorite income ETFs are Vanguard products, and it's easy to see why. Vanguard ETFs have some of the lowest expenses in the industry, and there are dozens of excellent index funds to choose from, in both mutual fund and ETF forms. With that in mind, here are three Vanguard ETFs that could help you create a passive income stream for decades to come in your portfolio. At first glance, the Vanguard Dividend Appreciation ETF (NYSEMKT: VIG), with a 1.8% yield, might not sound like a great choice. But there are a few things to keep in mind. First, this is an index fund that focuses on stocks that are most likely to grow their dividends over time. So, if you want to create a passive income stream but are still a decade or more from retirement, this ETF is likely to produce a significantly higher amount of income in the future. Second, because it isn't too focused on the highest-yielding stocks, the portfolio of the Vanguard Dividend Appreciation ETF is a bit more growth-oriented than your traditional income ETF. In fact, the technology sector is its highest concentration, with top holdings that include Broadcom (NASDAQ: AVGO), Microsoft (NASDAQ: MSFT), and Apple (NASDAQ: AAPL). The proof is in the performance. Over the past decade, this ETF has generated 11.2% annualized total returns, and with a rock-bottom 0.05% expense ratio, you'll get to keep most of the fund's gains. One of the ETFs I've been buying rather aggressively in my own portfolio is the Vanguard International High Dividend Yield ETF (NASDAQ: VYMI). As the name suggests, this tracks an index of non-U.S. companies that pay above average dividend yields. As of the latest information, the fund owns 1,560 different stocks and has a 4.2% dividend yield. Not only can international stock exposure help diversify your portfolio and help offset U.S.-specific risk factors (like the trade tensions), but international stocks in general look cheap right now. For example, the average stock in the Vanguard International High Dividend Yield ETF trades for just 11.6 times earnings, compared with a P/E of 18.2 for stocks in the U.S. focused counterpart ETF, the Vanguard High Dividend Yield ETF (NYSEMKT: VYM). It's also worth noting that although these are international stocks, that doesn't mean its full of companies you've never heard of. In fact, top holdings include household names such as Toyota (NYSE: TM), Shell (NYSE: SHEL), and Unilever (NYSE: UL). Although there are questions surrounding how soon and how aggressively the Federal Reserve will lower interest rates, the overwhelming consensus is that the direction of interest rates over the next couple of years is going to be downward. Real estate is perhaps the most rate-sensitive part of the stock market. When rates are lower, real estate investment trusts can borrow money in a more cost-effective way, and commercial property values tend to rise, as yield plays a major role in their valuation. The Vanguard Real Estate ETF (NYSEMKT: VNQ) has underperformed the market for several years, but this is mainly due to the interest rate environment and not because there is anything fundamentally wrong with the stocks it owns. While there's still tremendous uncertainty about where interest rates are heading in the short term, it could be a smart time for long-term investors to take a closer look at this ETF. These certainly aren't the only three income ETFs I'm a fan of. There are some that take more active investment approaches on my radar, such as the options-focused JPMorgan Nasdaq Equity Premium Income ETF (NASDAQ: JEPQ). However, as far as creating a truly passive income stream that you can simply set-and-forget goes, these three Vanguard Income ETFs could be excellent additions to your portfolio. Before you buy stock in Vanguard Dividend Appreciation ETF, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the for investors to buy now… and Vanguard Dividend Appreciation ETF wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $640,662!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $814,127!* Now, it's worth noting Stock Advisor's total average return is 963% — a market-crushing outperformance compared to 168% for the S&P 500. Don't miss out on the latest top 10 list, available when you join . See the 10 stocks » *Stock Advisor returns as of May 19, 2025 Matt Frankel has positions in Vanguard International High Dividend Yield ETF and Vanguard Real Estate ETF. The Motley Fool has positions in and recommends Apple, Microsoft, Vanguard Dividend Appreciation ETF, Vanguard Real Estate ETF, and Vanguard Whitehall Funds-Vanguard High Dividend Yield ETF. The Motley Fool recommends Broadcom and Unilever and recommends the following options: long January 2026 $395 calls on Microsoft and short January 2026 $405 calls on Microsoft. The Motley Fool has a disclosure policy. Building a Passive Income Stream: 3 Top Dividend ETFs for Long-Term Returns was originally published by The Motley Fool
Yahoo
23-05-2025
- Business
- Yahoo
Building a Passive Income Stream: 3 Top Dividend ETFs for Long-Term Returns
The Vanguard Dividend Appreciation ETF isn't the highest-paying income ETF, but there's a lot to like about it. The Vanguard International High Dividend Yield ETF has an excellent yield and cheap valuation. The Vanguard Real Estate ETF could be a big winner as interest rates fall. 10 stocks we like better than Vanguard Dividend Appreciation ETF › There are dozens of excellent low-cost index funds that pay dividends and could be great choices for long-term investors. However, a few stand out as particularly good combinations of income, long-term total return potential, and truly passive set-it-and-forget-it qualities. Most of my favorite income ETFs are Vanguard products, and it's easy to see why. Vanguard ETFs have some of the lowest expenses in the industry, and there are dozens of excellent index funds to choose from, in both mutual fund and ETF forms. With that in mind, here are three Vanguard ETFs that could help you create a passive income stream for decades to come in your portfolio. At first glance, the Vanguard Dividend Appreciation ETF (NYSEMKT: VIG), with a 1.8% yield, might not sound like a great choice. But there are a few things to keep in mind. First, this is an index fund that focuses on stocks that are most likely to grow their dividends over time. So, if you want to create a passive income stream but are still a decade or more from retirement, this ETF is likely to produce a significantly higher amount of income in the future. Second, because it isn't too focused on the highest-yielding stocks, the portfolio of the Vanguard Dividend Appreciation ETF is a bit more growth-oriented than your traditional income ETF. In fact, the technology sector is its highest concentration, with top holdings that include Broadcom (NASDAQ: AVGO), Microsoft (NASDAQ: MSFT), and Apple (NASDAQ: AAPL). The proof is in the performance. Over the past decade, this ETF has generated 11.2% annualized total returns, and with a rock-bottom 0.05% expense ratio, you'll get to keep most of the fund's gains. One of the ETFs I've been buying rather aggressively in my own portfolio is the Vanguard International High Dividend Yield ETF (NASDAQ: VYMI). As the name suggests, this tracks an index of non-U.S. companies that pay above average dividend yields. As of the latest information, the fund owns 1,560 different stocks and has a 4.2% dividend yield. Not only can international stock exposure help diversify your portfolio and help offset U.S.-specific risk factors (like the trade tensions), but international stocks in general look cheap right now. For example, the average stock in the Vanguard International High Dividend Yield ETF trades for just 11.6 times earnings, compared with a P/E of 18.2 for stocks in the U.S. focused counterpart ETF, the Vanguard High Dividend Yield ETF (NYSEMKT: VYM). It's also worth noting that although these are international stocks, that doesn't mean its full of companies you've never heard of. In fact, top holdings include household names such as Toyota (NYSE: TM), Shell (NYSE: SHEL), and Unilever (NYSE: UL). Although there are questions surrounding how soon and how aggressively the Federal Reserve will lower interest rates, the overwhelming consensus is that the direction of interest rates over the next couple of years is going to be downward. Real estate is perhaps the most rate-sensitive part of the stock market. When rates are lower, real estate investment trusts can borrow money in a more cost-effective way, and commercial property values tend to rise, as yield plays a major role in their valuation. The Vanguard Real Estate ETF (NYSEMKT: VNQ) has underperformed the market for several years, but this is mainly due to the interest rate environment and not because there is anything fundamentally wrong with the stocks it owns. While there's still tremendous uncertainty about where interest rates are heading in the short term, it could be a smart time for long-term investors to take a closer look at this ETF. These certainly aren't the only three income ETFs I'm a fan of. There are some that take more active investment approaches on my radar, such as the options-focused JPMorgan Nasdaq Equity Premium Income ETF (NASDAQ: JEPQ). However, as far as creating a truly passive income stream that you can simply set-and-forget goes, these three Vanguard Income ETFs could be excellent additions to your portfolio. Before you buy stock in Vanguard Dividend Appreciation ETF, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the for investors to buy now… and Vanguard Dividend Appreciation ETF wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $640,662!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $814,127!* Now, it's worth noting Stock Advisor's total average return is 963% — a market-crushing outperformance compared to 168% for the S&P 500. Don't miss out on the latest top 10 list, available when you join . See the 10 stocks » *Stock Advisor returns as of May 19, 2025 Matt Frankel has positions in Vanguard International High Dividend Yield ETF and Vanguard Real Estate ETF. The Motley Fool has positions in and recommends Apple, Microsoft, Vanguard Dividend Appreciation ETF, Vanguard Real Estate ETF, and Vanguard Whitehall Funds-Vanguard High Dividend Yield ETF. The Motley Fool recommends Broadcom and Unilever and recommends the following options: long January 2026 $395 calls on Microsoft and short January 2026 $405 calls on Microsoft. The Motley Fool has a disclosure policy. Building a Passive Income Stream: 3 Top Dividend ETFs for Long-Term Returns was originally published by The Motley Fool
Yahoo
14-05-2025
- Business
- Yahoo
Here's My Favorite High-Dividend ETF to Buy Right Now
The Vanguard International High Dividend Yield ETF invests in high-paying stocks outside the U.S. The portfolio is extremely diverse, and many of the top holdings are familiar to U.S. investors. Even near its 52-week high, this ETF is worth a closer look right now. 10 stocks we like better than Vanguard International High Dividend Yield ETF › There are some excellent dividend stock exchange-traded funds (ETFs) in the market, and that's especially true right now. Thanks to the relatively high-interest environment and economic uncertainty, many dividend stocks are trading significantly below their highs. With that in mind, it might come as a surprise that my favorite high-dividend ETF to buy right now is one that isn't beaten down. In fact, the Vanguard International High Dividend Yield ETF (NASDAQ: VYMI) just reached a new all-time high on the day this was written. But it isn't nearly as "expensive" as you might think and can be a great choice for anyone looking for both dividend income and geographical diversification. The Vanguard International High Dividend Yield ETF is an index fund which, as the name implies, invests in companies based outside of the United States with above-average dividend yields. In all, the index it tracks consists of about 1,500 stocks, most of which are larger companies (the median market cap is $49.1 billion). About 44% of the portfolio is based in Europe, 26% in the Asia-Pacific region, and 22% from emerging markets, to name the big three contributors. The fund is weighted, meaning that larger companies make up a larger proportion of the fund's assets. But unlike some of the most popular U.S. index funds, such as the Vanguard S&P 500 ETF (NYSEMKT: VOO), even the largest components make up less than 2% of the assets. It's also worth noting that even though the fund invests in international companies, that doesn't mean that it's businesses don't operate in the U.S. There's certainly an element of that, but you'll find Nestle, Shell, Novartis, Toyota, and Royal Bank of Canada, just to name a few of the fund's 10 largest holdings. The dividends paid by these stocks are passed through to shareholders, and because they come from over 1,500 different companies, all of which have different distribution schedules and other factors, the payments can vary from quarter to quarter. However, based on the past four quarterly distributions, the ETF has a yield of about 4.3% as of this writing. The fund is also relatively cheap. Sure, its 0.17% expense ratio isn't quite as low as you'll find with some of the large, domestic Vanguard ETFs. But it is a fraction of the cost of most actively managed mutual funds and ETFs that focus on foreign stocks. It's worth noting that the Vanguard International High Dividend ETF is trading for just below its 52-week high as I write this. But that doesn't mean it's expensive. In fact, quite the opposite is true. The average price-to-earnings (P/E) ratio of the stocks in the ETF is just 11.7 despite a weighted-average earnings growth rate of more than 13% from the stocks in the portfolio. The average stock in the portfolio trades for just 1.4 times book value, half the price-to-book value (P/B) valuation of the typical stock in Vanguard's U.S. version of the ETF, the Vanguard High Dividend Yield ETF (NYSEMKT: VYM). Of course, there are some risks. Many of the companies in the portfolio could potentially be impacted by tariffs, and although it has rebounded, that's why this ETF was extremely hard-hit when President Trump's initial reciprocal tariff announcement took place. There are also foreign exchange risks, political risks, and several others that don't apply much to purely U.S. companies. For my money, the Vanguard International High Dividend Yield ETF looks extremely attractive right now from a risk-reward perspective. I added it to my portfolio earlier this year and plan to continue to add to my position throughout 2025. Before you buy stock in Vanguard International High Dividend Yield ETF, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the for investors to buy now… and Vanguard International High Dividend Yield ETF wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $598,613!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $753,878!* Now, it's worth noting Stock Advisor's total average return is 922% — a market-crushing outperformance compared to 169% for the S&P 500. Don't miss out on the latest top 10 list, available when you join . See the 10 stocks » *Stock Advisor returns as of May 12, 2025 Matt Frankel has positions in Vanguard International High Dividend Yield ETF and Vanguard S&P 500 ETF. The Motley Fool has positions in and recommends Vanguard S&P 500 ETF and Vanguard Whitehall Funds-Vanguard High Dividend Yield ETF. The Motley Fool has a disclosure policy. Here's My Favorite High-Dividend ETF to Buy Right Now was originally published by The Motley Fool 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
Globe and Mail
30-03-2025
- Business
- Globe and Mail
The Top 3 Vanguard ETFs of 2025 (so Far) Share This 1 Striking Common Denominator
Baskin-Robbins has nothing on Vanguard. The ice cream chain is famous for offering 31 flavors to ice cream lovers. Meanwhile, Vanguard's family of exchange-traded funds (ETFs) features 90 choices for investors. However, some of those funds will probably "taste" very similar. The top three Vanguard ETFs of 2025 (so far) share one striking common denominator. Funds of a feather Vanguard markets multiple types of ETFs. You can buy funds that focus on specific U.S. sectors. Some ETFs own only large-cap stocks. Others specialize in small-cap stocks and mid-cap stocks. Vanguard offers ETFs with only growth stocks in their portfolios and others with only value stocks. Some Vanguard funds allow you to invest in bonds of varying maturities. However, the three best performing Vanguard ETFs year to date don't focus on any of those asset classes. Instead, they all concentrate on international stocks. The Vanguard FTSE Europe ETF (NYSEMKT: VGK) ranks as the top Vanguard ETF of 2025 with a return of around 12%. This fund owns 1,263 stocks, all headquartered in the key European markets of Austria, Belgium, Denmark, Finland, France, Germany, Greece, Ireland, Italy, the Netherlands, Norway, Portugal, Spain, Sweden, Switzerland, and the United Kingdom. The Vanguard International High Dividend Yield ETF (NASDAQ: VYMI) has gained nearly 10% year to date. As its name indicates, this ETF focuses on international stocks that offer above-average dividend yields. Its portfolio features 1,491 stocks, with top holdings including Swiss food and beverage company Nestlé, healthcare giant Roche , and big drugmaker Novartis. Nearly 45% of the Vanguard International High Dividend Yield ETF's stocks are based in Europe. The Vanguard FTSE Developed Markets ETF (NYSEMKT: VEA) has risen over 8% in 2025, landing it in the No. 3 spot among Vanguard's best performing ETFs. This fund owns a diversified portfolio of 3,910 international stocks, from large-cap to small-cap. Its top holdings include German software company SAP, Danish pharmaceutical company Novo Nordisk, and Dutch semiconductor fabrication equipment maker ASML. Why are international Vanguard ETFs performing so well? It isn't only Vanguard's top three ETFs this year that focus on international stocks. Eight of the fund manager's top 10 ETFs do so as well. Could that be a coincidence? Nope. One reason international stocks, especially those based in Europe, are outperforming their U.S. peers is that they're more attractively valued. For example, even with its strong year-to-date gains, the Vanguard FTSE Europe ETF's price-to-earnings (P/E) ratio is 17.4. By comparison, the Vanguard S&P 500 ETF trades at 26.9 times earnings. European defense stocks have been especially big winners. Why? European Union members including Germany plan to increase their defense spending over the next few years. Economic data from European governments has also been better than expected. And the trend isn't limited to only one sector. European banking, manufacturing, and services have seen improvement. Some wishful thinking could also be a factor. The Trump administration's prioritization of negotiating an end to the war between Russia and Ukraine has raised hopes that energy prices could come down and pave the way for significant investments in reconstruction in Ukraine. Should you buy these Vanguard ETFs? When so many similar ETFs are performing well, many investors could be tempted to jump on the bandwagon. Is that a good idea? Maybe, but maybe not. International stocks could continue to outgain U.S. stocks over the near term. If this happens, the Vanguard FTSE Europe ETF, the Vanguard International High Dividend Yield ETF, and the Vanguard FTSE Developed Markets ETF could remain top performers. However, a severe and prolonged trade war between the U.S. and Europe (as well as with other regions) resulting from the Trump administration's tariffs could weigh on U.S. and international stocks alike. The "peace dividend" from a cessation of hostilities between Russia and Ukraine could also be less likely than hoped. Investing in Vanguard ETFs that focus on international stocks to provide more portfolio diversification isn't a bad idea. But betting the farm that the current trend of these ETFs outperforming funds focused on other asset classes over the long term might not pay off. Don't miss this second chance at a potentially lucrative opportunity Ever feel like you missed the boat in buying the most successful stocks? Then you'll want to hear this. On rare occasions, our expert team of analysts issues a 'Double Down' stock recommendation for companies that they think are about to pop. If you're worried you've already missed your chance to invest, now is the best time to buy before it's too late. And the numbers speak for themselves: Nvidia: if you invested $1,000 when we doubled down in 2009, you'd have $284,402!* Apple: if you invested $1,000 when we doubled down in 2008, you'd have $41,312!* Netflix: if you invested $1,000 when we doubled down in 2004, you'd have $503,617!* Right now, we're issuing 'Double Down' alerts for three incredible companies, and there may not be another chance like this anytime soon. Continue » *Stock Advisor returns as of March 24, 2025 Keith Speights has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends ASML, Vanguard S&P 500 ETF, and Vanguard Tax-Managed Funds-Vanguard Ftse Developed Markets ETF. The Motley Fool recommends Nestlé, Novo Nordisk, and Roche Holding AG. The Motley Fool has a disclosure policy.
