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, non U.S.-listed 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 will. 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?

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 costs.

5 Best International ETFs to Buy in 2026

By Tony Dong – Updated Sep 15, 2026 at 4:42 PM EST | Fact-checked by Frank Bass

Key Points

International ETFs provide global market exposure without needing to invest in foreign stocks directly.
Vanguard Total International Stock ETF offers extensive global diversification at a 0.05% expense ratio.
Diversified international ETF investments hedge against periods when U.S. markets underperform.

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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.

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5 Top international ETFs for 2026

The following international ETFs offer large asset bases, broad diversification across sectors, sizes, and countries, strong liquidity, long track records, and reasonable costs, making them smart building blocks for global diversification.

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Ticker Information Table
Name and ticker	Current price
Vanguard Total International Stock ETF (NASDAQ:VXUS)	$82.53
Vanguard FTSE All-World ex-US Small-Cap ETF (NYSEMKT:VSS)	$149.35
iShares Trust - iShares Core Msci Eafe ETF (NYSEMKT:IEFA)	$95.68
State Street SPDR Portfolio Emerging Markets ETF (NYSEMKT:SPEM)	$49.67
Schwab Strategic Trust - Schwab International Dividend Equity ETF (NYSEMKT:SCHY)	$33.03

Data as of Oct 25, 2026. Showing 5 of 5 total entries.

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1. Vanguard Total International Stock ETF

The Vanguard Total International Stock ETF (VXUS -0.24%) is the “buy-it-all” option for international exposure. It tracks the FTSE Global All Cap ex-US Index, covering more than 8,600 market-cap-weighted 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 with a 9.65% annualized total return as of Aug. 31, 2026, but past performance doesn’t predict the future. With a low 0.05% expense ratio, it faces few structural headwinds for long-term investors seeking global diversification.

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VXUS Vanguard Total International Stock ETF

$82.53-$0.20 (-0.24%)

NASDAQ · As of 4:00 PM ET 10/23/26

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

$149.35-$0.56 (-0.37%)

NYSEMKT · As of 4:00 PM ET 10/23/26

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3. iShares Core MSCI EAFE ETF

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. That includes countries like Japan, the United Kingdom, France, Germany, and Australia.

The iShares Core MSCI EAFE ETF (IEFA -0.49%) 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. This ETF charges a low expense ratio of 0.07% and also offers decent income potential with a 2.3% 30-day SEC yield as of Aug. 31, 2026.

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IEFA iShares Trust - iShares Core Msci Eafe ETF

$95.68-$0.47 (-0.49%)

NYSEMKT · As of 4:00 PM ET 10/23/26

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4. SPDR Portfolio Emerging Markets ETF

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. This includes countries such as China, India, Brazil, South Africa, and Mexico.

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 +0.02%), which tracks about 3,000 holdings through the S&P® Emerging BMI index.

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

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SPEM State Street SPDR Portfolio Emerging Markets ETF

$49.67+$0.01 (+0.02%)

NYSEMKT · As of 4:00 PM ET 10/23/26

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5. Schwab International Dividend Equity ETF

One thing income investors will appreciate about international equities is their tendency to offer higher dividend yields compared to U.S. stocks. if income is your goal, the Schwab International Dividend Equity ETF (SCHY +0.00%) 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 3.81% as of Sept. 11, 2026. Its 0.08% expense ratio is highly competitive in the international dividend ETF space.

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SCHY Schwab Strategic Trust - Schwab International Dividend Equity ETF

$33.03+$0.00 (+0.00%)

NYSEMKT · As of 4:00 PM ET 10/23/26

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How to buy international ETFs

Open your brokerage account: Log in to your brokerage account where you handle your investments. If you don't have one yet, take a look at our favorite brokers and trading platforms to find the right one for you.
Search for the ETF: Enter the ticker 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.

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Benefits and risks of investing in international ETFs

Benefits

Greater diversification: International ETFs reduce reliance on a single country by spreading investments across multiple economies, industries, and currencies, potentially lowering overall portfolio concentration risk.
Potentially more attractive valuations: International markets have often traded at lower price-to-earnings and price-to-book multiples than U.S. stocks, which may provide a greater margin of safety and higher expected long-term returns if valuations normalize.
Higher income potential: Many international markets, particularly in Europe and Canada, have a stronger dividend culture than the U.S., resulting in above-average portfolio yields for many international ETFs.

Risks

Currency volatility: Unless the ETF hedges its foreign-exchange exposure, exchange-rate movements can amplify or reduce returns, regardless of how the underlying stocks perform.
Geopolitical and regulatory risk: International investing exposes investors to political instability, trade disputes, sanctions, regulatory changes, and country-specific economic risks that may not affect domestic portfolios.
Higher fees: International ETFs generally cost more than comparable U.S. index funds because investing across multiple foreign markets involves higher trading, custody, and operational costs.

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Methodology: How these international ETFs were chosen

For international ETFs, we prioritized funds with low expense ratios, substantial assets under management, and long operating histories. Larger, established ETFs generally offer better liquidity, tighter bid-ask spreads, and a lower risk of fund closure, while lower fees help preserve more of an investor's long-term returns.

We also favored ETFs from reputable providers with extensive experience managing international portfolios. Beyond costs and size, diversification was a key consideration. Preference was given to funds that provide broad exposure across developed and emerging markets, multiple sectors, and companies of all market capitalizations, rather than concentrating solely on a single region, country, or investment style.

Finally, we evaluated each ETF's underlying methodology rather than simply looking at past performance. Whether a fund tracks a market-cap-weighted index or uses a more specialized approach, understanding how securities are selected and weighted is often a better indicator of how the ETF is likely to behave across different market environments.

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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 to allocate roughly 20% to 40% of your equity portfolio to international markets, enough to improve global diversification without overexposing you to foreign risks.

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International ETFs FAQ

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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.

5 Best International ETFs to Buy in 2026

Key Points

5 Top international ETFs for 2026

1. Vanguard Total International Stock ETF

VXUS - Vanguard Total International Stock ETF

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Top holdings

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

Key data points