If you're concerned about high U.S. market valuations, the Vanguard Total International Stock ETF (VXUS -0.24%) offers a simple way to diversify your portfolio with international exposure.
This ETF is widely considered the go-to option for investors who want exposure to global equities without the hassle of picking individual international stocks. It provides broad coverage of both developed and emerging markets, all in one fund.
Here's what you need to know about this top ETF before you invest.
NASDAQ: VXUS
Key Data Points
What is Vanguard Total International Stock ETF (VXUS)?
Vanguard Total International Stock ETF (VXUS) is a passively managed exchange-traded fund (ETF) that tracks the FTSE Global All Cap ex US Index, a benchmark of over 8,500 non-U.S. equities.
The ETF offers broad international diversification, splitting its holdings between developed markets like Japan, the United Kingdom, Canada, Switzerland, Germany, and Australia, and emerging markets such as China, India, Brazil, Taiwan, and South Africa.
The fund is market cap-weighted, meaning larger companies are assigned more weight in the portfolio.
Exchange-Traded Fund (ETF)
How to buy Vanguard Total International Stock ETF (VXUS)
- Open your brokerage app: Log into your brokerage account where you handle your investments.
- Search for the ETF: Enter the ticker "VXUS" or the ETF name into the search bar to bring up the ETF's trading page.
- Decide how many shares to buy: Consider your investment goals and how much of your portfolio you want to allocate to this ETF.
- Select order type: Choose between a market order to buy at the current price or a limit order to specify the maximum price you're willing to pay.
- Submit your order: Confirm the details and submit your buy order.
- Review your purchase: Check your portfolio to ensure your order was filled as expected and adjust your investment strategy accordingly.
Holdings of Vanguard Total International Stock ETF (VXUS)
This Vanguard ETF holds over 8,600 stocks across developed and emerging markets. Its top 10 holdings are a mix of globally recognized companies. Here are some of the largest positions:
- Taiwan Semiconductor Manufacturing (TWSE:2330)
- Tencent Holdings (SEHK:700)
- Alibaba Group (SEHK:9988)
- ASML Holding NV (ASML -1.49%)
- SAP (SAP +0.11%)
- AstraZeneca (AZN -0.61%)
- Nestle (NESN -0.74%)
- Novartis (NOVN +0.39%)
- Samsung (SSUN +2.26%)
- Roche Holding (ROG -1.07%)
About 27% of this ETF's portfolio is allocated to emerging markets, with the remainder in developed markets. The highest country weights include Japan, China, the United Kingdom, and Canada.
Sector-wise, this Vanguard ETF leans on financials, industrials, and technology.
Should I invest in Vanguard Total International Stock ETF (VXUS)?
This ETF is best suited for investors who believe in the importance of international diversification and prefer a simple, hands-off approach to gaining exposure to the global market outside of the U.S.
By holding this fund, you can own a broad basket of non-U.S. equities without needing to research or select individual stocks. However, it may be less suitable for investors who are bullish on U.S. equities and prefer to focus solely on domestic markets.
Does Vanguard Total International Stock ETF (VXUS) pay a dividend?
Yes, this ETF pays a dividend, currently offering a trailing 12-month yield of 2.74%. International stocks tend to yield more than U.S. equities on average, so the yield for this ETF rivals that of some dividend ETFs. Dividends are distributed quarterly.
What is Vanguard Total International Stock ETF (VXUS)'s expense ratio?
VXUS has a low expense ratio of 0.05% annually, meaning you'd pay just $5 per year for every $10,000 invested. This fee isn't paid upfront but is deducted from the ETF's performance over time.
ETF Expense Ratio
Historical performance of Vanguard Total International Stock ETF (VXUS)
Here's a look at the annualized total return (i.e., with dividends reinvested) over various trailing periods.
Metric | 1-yr | 3-yr | 5-yr | 10-yr |
|---|---|---|---|---|
Net Asset Value (NAV) | 17.18% | 20.84% | 10.43% | 8.36% |
Market Price | 17.17% | 20.81% | 10.40% | 8.34% |
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The bottom line on Vanguard Total International Stock ETF (VXUS)
This Vanguard ETF remains a top choice for investors seeking cost-effective and broad international diversification. With exposure to over 8,600 stocks for an expense ratio of just 0.05%, it's tough to beat.
This ETF doesn't take any active bets, instead buying the entire haystack of investable non-U.S. markets at market-cap weights.
It provides coverage of virtually all developed and emerging market countries, so there’s no need to worry about which one will outperform.
