How do I invest in international ETFs?

Just like with any stock or ETF, you can buy and sell international ETFs through your brokerage using the bid and ask prices during market hours.

How does an international ETF work?

International ETFs work like other ETFs by holding a basket of stocks -- in this case, from foreign markets -- and using the creation and redemption process to keep the ETF's price close to the value of its holdings.

Do international ETFs pay dividends?

Some do, but not all. It depends on the ETF's strategy and whether the underlying companies regularly distribute dividends.

Is an international ETF considered a foreign asset?

No. Even though the underlying stocks may be from outside the United States, the ETF itself is U.S.-domiciled and not classified as a foreign asset.

Are international ETFs more expensive than domestic ETFs?

On average, international ETFs tend to carry slightly higher expense ratios than domestic ones. That’s because they involve additional costs such as currency conversion, cross-border custody, and compliance with multiple market regulations. However, the difference isn’t huge. Many low-cost options now exist, with fees as low as 0.05%, making it easy to diversify globally without paying a premium.

Can international ETFs help hedge against U.S. market downturns?

It depends on the type of downturn. In a broad global market crash, international ETFs won’t protect you much -- stocks around the world often fall together during periods of panic. But over longer cycles, they can help smooth out returns. There have been decades where U.S. markets underperformed while international markets picked up the slack.

Are emerging market ETFs riskier than developed market ETFs?

Yes. Historically, emerging market ETFs have been more volatile. Reasons include political instability, weaker regulatory environments, currency risk, higher exposure to state-owned enterprises, and greater sensitivity to global capital flows and geopolitical events.

How do currency fluctuations affect international ETFs?

Currency movements directly affect returns. When the U.S. dollar rises, foreign holdings become a headwind for U.S.-based investors because overseas returns translate back into fewer dollars. When the U.S. dollar falls, foreign currencies become a tailwind for U.S.-based investors, as overseas returns translate into more U.S. dollars. Some ETFs hedge currency exposure, which can reduce volatility but adds cost and may limit upside.

Best International ETFs to Buy in 2026

By Tony Dong – Updated Apr 10, 2026 at 12:26 AM EST | Fact-checked by Frank Bass

Key Points

International ETFs offer simple global investment exposure with lower costs compared to individual stocks.
Past data shows periods where international stocks outperform U.S. markets, justifying diversified portfolios.
Choosing international ETFs should consider costs, liquidity, and how they fit within broader investment goals.

International exchange-traded funds (ETFs) are listed investment vehicles that hold stocks from countries outside the U.S. They offer a simple way to gain global exposure without buying individual foreign stocks or American Depository Receipts (ADRs), which can be complex and costly.

While U.S. stocks have outperformed over the past decade, that hasn't always been the case. During the "lost decade" from 1999 to 2009, international stocks solidly outperformed U.S. equities. Savvy investors often maintain some international exposure to hedge against periods when domestic markets fall behind.

Loading paragraph...

Top international ETFs to consider

The following international ETFs offer solid exposure, strong liquidity, and reasonable costs, making them smart building blocks for global diversification.

Loading paragraph...

Top International ETFs Comparison (as of April 2026)
ETF Name and Ticker	Expense Ratio	3-Year Annualized Return
Vanguard Total International Stock ETF (VXUS)	0.05%	15.50%
Vanguard FTSE All-World ex-US Small-Cap ETF (VSS)	0.06%	13.84%
iShares Core MSCI EAFE ETF (IEFA)	0.07%	14.43%
State Street SPDR Portfolio Emerging Markets ETF (SPEM)	0.07%	13.36%
Schwab International Dividend Equity ETF (SCHY)	0.08%	15.08%

Loading table...

1. Vanguard Total International Stock ETF

NASDAQ: VXUS

Vanguard Total International Stock ETF

Today's Change

(0.51%) $0.42

Current Price

$83.53

Key Data Points

Day's Range

$82.83 - $83.87

52wk Range

$66.16 - $85.78

Volume

961

Loading company_card...

The Vanguard Total International Stock ETF (VXUS +0.51%) is the “buy-it-all” option for international exposure. It tracks the FTSE Global All Cap ex-US Index, covering more than 8,600 stocks across small-, mid-, and large-cap companies from both developed and emerging markets.

This ETF has underperformed U.S. stocks over the past decade, but past performance doesn’t predict the future. With a low 0.05% expense ratio, it has few structural headwinds for long-term investors looking for global diversification.

Loading paragraph...

2. Vanguard FTSE All-World ex-US Small-Cap ETF

NYSEMKT: VSS

Vanguard FTSE All-World ex-US Small-Cap ETF

Today's Change

(0.30%) $0.47

Current Price

$158.07

Key Data Points

Day's Range

$156.79 - $158.75

52wk Range

$125.46 - $162.91

Volume

590K

Loading company_card...

Most international ETFs are market-cap-weighted, meaning larger companies make up a bigger portion of the fund. This provides stability but can limit growth potential since small-cap stocks tend to be riskier but offer higher expected returns over time. If you want to tilt toward international small caps, the Vanguard FTSE All-World ex-US Small-Cap ETF (VSS +0.30%) is a solid option.

It tracks the FTSE Global Small Cap ex-US index, holding more than 4,800 global small-cap stocks with a median market cap of $2.5 billion. You can expect more volatility than with large-cap international ETFs, and Vanguard rates it 5/5 on the risk scale. Still, it’s affordably priced with a 0.06% expense ratio.

Loading paragraph...

3. iShares Core MSCI EAFE ETF

NYSEMKT: IEFA

iShares Trust - iShares Core Msci Eafe ETF

Today's Change

(0.94%) $0.89

Current Price

$96.10

Key Data Points

Day's Range

$95.25 - $96.20

52wk Range

$79.82 - $98.83

Volume

Loading company_card...

You can break international markets down not just by country but also by classification -- developed or emerging. Developed markets typically have more mature economies, stable political systems, and well-regulated financial markets.

The iShares Core MSCI EAFE ETF (IEFA +0.94%) covers this segment by tracking the MSCI EAFE IMI Index, which holds more than 2,600 stocks from developed markets across Europe, Australasia, and the Far East. That includes countries like Japan, the United Kingdom, France, Germany, and Australia. This ETF charges a low expense ratio of 0.07%.

Loading paragraph...

4. SPDR Portfolio Emerging Markets ETF

NYSEMKT: SPEM

State Street SPDR Portfolio Emerging Markets ETF

Today's Change

(0.18%) $0.09

Current Price

$50.93

Key Data Points

Day's Range

$50.57 - $51.23

52wk Range

$40.66 - $53.03

Volume

580

Loading company_card...

The counterpart to developed markets are emerging markets -- countries with growing but less mature economies, often marked by faster GDP growth, less stable political systems, and less developed financial infrastructure.

For exposure to this group, you can complement a fund like the iShares Core MSCI EAFE ETF with the SPDR Portfolio Emerging Markets ETF (SPEM +0.18%), which tracks more than 3,000 holdings through the S&P® Emerging BMI index. This includes major emerging economies such as China, India, Brazil, South Africa, and Mexico.

Emerging markets have been laggards over the past decade. But that backward-looking performance shouldn't stop you from considering a forward-looking allocation -- just a small position in emerging markets can offer strong diversification benefits. It also keeps costs low with an expense ratio of 0.07%.

Loading paragraph...

5. Schwab International Dividend Equity ETF

NYSEMKT: SCHY

Schwab Strategic Trust - Schwab International Dividend Equity ETF

Today's Change

(1.56%) $0.50

Current Price

$32.50

Key Data Points

Day's Range

$32.27 - $32.53

52wk Range

$26.80 - $34.04

Volume

Loading company_card...

One thing income investors will appreciate about international equities is their tendency to offer higher dividend yields compared to U.S. stocks. The Schwab International Dividend Equity ETF (SCHY +1.56%) is worth a look. It tracks the Dow Jones International Dividend 100 index, which screens for companies with at least 10 consecutive years of dividend payments.

Then, the Schwab International Dividend Equity ETF applies a composite score based on free cash flow to total debt, return on equity, dividend yield, and five-year dividend growth rate. The result is a portfolio with a strong 30-day SEC yield of 3.91%. Its 0.08% expense ratio is highly competitive in the international dividend equity space.

Loading paragraph...

Should you invest in international ETFs?

Holding stocks from around the world reduces your exposure to a single economy or currency. When U.S. markets struggle, international equities from regions like Europe or Asia can offset some of that weakness, while also giving you access to different sectors, consumer trends, and economic cycles.

Valuation is another consideration. Many international markets currently trade at lower price-to-earnings ratios than U.S. equities, meaning investors may be getting more earnings per dollar invested. A weaker U.S. dollar could further support returns over time.

The main trade-offs are currency risk, as foreign currencies fluctuate against the dollar, and slower growth in many developed markets outside North America. Certain regions also carry greater political and economic instability.

For most long-term investors, a reasonable target is allocating roughly 30% to 40% of your equity portfolio to international markets, enough to improve global balance without overexposing you to foreign risks.

Loading paragraph...

How to choose the best international ETF

Start by defining the exposure you want. Some investors prefer a single-country or regional ETF; others want broad exposure to everything outside the U.S. Being clear on this upfront avoids unintended overlap and narrows your choices quickly.

Next, decide between passive and active management. Passive ETFs track an index and offer lower fees, greater transparency, and predictable exposure. Actively managed ETFs aim to outperform but typically come with higher costs and manager risk.

Then screen for cost and liquidity. Look at the expense ratio and 30-day median bid-ask spread together, as these represent the ongoing and transaction costs of ownership. International ETFs, especially those targeting smaller markets, can have wider spreads.

Finally, consider how the ETF fits your broader portfolio. Decide how much of your total allocation you want in international equities, what role the fund plays in diversification, and how often you plan to rebalance.

Loading paragraph...

FAQ

International ETFs FAQ

Loading faq...

Tony Dong has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Vanguard FTSE All-World ex-US Small-Cap ETF and Vanguard Total International Stock ETF. The Motley Fool has a disclosure policy.

Best International ETFs to Buy in 2026

Key Points

Top international ETFs to consider

1. Vanguard Total International Stock ETF

Key Data Points

2. Vanguard FTSE All-World ex-US Small-Cap ETF

Key Data Points

3. iShares Core MSCI EAFE ETF

Key Data Points

4. SPDR Portfolio Emerging Markets ETF

Key Data Points

5. Schwab International Dividend Equity ETF

Key Data Points

Should you invest in international ETFs?

How to choose the best international ETF

Related investing topics

Best Stocks to Buy in May 2026

What Is Forex Trading?

Trading on the Over-the-Counter (OTC) Market

Best International Stocks to Buy in 2026: Are They Right for Your Portfolio?

FAQ

International ETFs FAQ

How do I invest in international ETFs?

How do I invest in international ETFs?

How does an international ETF work?

How does an international ETF work?

Do international ETFs pay dividends?

Do international ETFs pay dividends?

Is an international ETF considered a foreign asset?

Is an international ETF considered a foreign asset?

Are international ETFs more expensive than domestic ETFs?

Are international ETFs more expensive than domestic ETFs?

Can international ETFs help hedge against U.S. market downturns?

Can international ETFs help hedge against U.S. market downturns?

Are emerging market ETFs riskier than developed market ETFs?

Are emerging market ETFs riskier than developed market ETFs?

How do currency fluctuations affect international ETFs?

How do currency fluctuations affect international ETFs?

Read Next

Stocks Mentioned

Premium Investing Services

Top international ETFs to consider

Key Data Points

Key Data Points

Key Data Points

Key Data Points

Key Data Points

Should you invest in international ETFs?

How to choose the best international ETF

Best Stocks to Buy in May 2026

What Is Forex Trading?

Trading on the Over-the-Counter (OTC) Market

Best International Stocks to Buy in 2026: Are They Right for Your Portfolio?

International ETFs FAQ

How do I invest in international ETFs?

How do I invest in international ETFs?

How does an international ETF work?

How does an international ETF work?

Do international ETFs pay dividends?

Do international ETFs pay dividends?

Is an international ETF considered a foreign asset?

Is an international ETF considered a foreign asset?

Are international ETFs more expensive than domestic ETFs?

Are international ETFs more expensive than domestic ETFs?

Can international ETFs help hedge against U.S. market downturns?

Can international ETFs help hedge against U.S. market downturns?

Are emerging market ETFs riskier than developed market ETFs?

Are emerging market ETFs riskier than developed market ETFs?

How do currency fluctuations affect international ETFs?

How do currency fluctuations affect international ETFs?