3 Largest Global Ex-U.S. ETFs


Triston Martin

Jan 27, 2024

Many investors own domestic stock portfolios and wish to enhance their portfolios by exposing themselves to international equity. But, a significant portion of equity funds in the world put a significant part of their portfolios in businesses based in U.S. If you prefer exposure to international equity and not be reduced by the presence of more American firms or the global ex-U.S. ETF could be the best choice. They invest in stocks across the globe while making an effort to stay away from investing directly in U.S. Here is a listing of 3 of the most popular international ex-U.S. ETFs are based on the number of assets managed.

Vanguard Total International Stock ETF

The world's largest ex-U.S. fund has an AUM of $49 billion in the second quarter of 2022. It aims to monitor an index that determines the return on investments of shares issued by companies situated in both emerging and developed markets, with the exception of the U.S. It is a managed passive fund that employs a sampling of indexes and aims to monitor its performance against the Global All-Cap ex-U.S. Index.

It is also the largest invested ETF on this list, with investments in 7.826 various global equities having a weighted-average market cap of $80.4 billion. For regional exposure, the portfolio is divided in the following order: Asia-Pacific (46%); Europe (40%); N. America (8 8%); MidEast & Africa (4 percent) as well as Latin America (3%).

Vanguard FTSE All-World ex-US ETF (VEU)

It was the biggest worldwide ex-U.S. fund that was available and has since slipped to second place as of Q2 2022 with $33.1 billion AUM. The fund provides a simple method of gaining exposure to both emerging and developed non-U.S. markets for equity all over the globe. The passively-managed funds employ index sampling to measure their performance against the All-World FTSE ex-U.S. index.

The fund holds 3620 different stocks and has a weighted average value of $89 billion. The top 10 holdings of the fund comprise 9.5 percent of the total portfolio. In terms of regional exposure, the portfolio is divided according to the following categories: Asia-Pacific (46%); Europe (40%); N. America (7 7%); MidEast & Africa (4%); Latin America (3 percent). This fund's expense ratio is 0.07 percent. The yield of distribution on this fund stands at 3.41 percent.

iShares MSCI ACWI ex-U.S. ETF (ACWX)

According to ETF standards, an even larger, and still significant, the total international equity market ex-U.S. ETF is with $4.2 billion of AUM in the second quarter of 2022. The fund aims to give investors access to global equity markets, with the exception of those in the United States, including developed and emerging markets. It is best suited for investors looking for long-term growth. The fund is based on its index to the MSCI ACWI ex USA Index.

The portfolio comprises 1,880 diverse holdings that have a weighted average market capitalization in the range of $93.3 billion. The top 10 holdings of the fund comprise 11 percent of the total portfolio. The three largest sectors make up 49 percent of the fund. They include technology, finance, and industrials. The distribution yield of the ACWX is 3.9 percent.

Meaning in Investment

An investment fund is said to be an ex-U.S. or ex-United States if it does not invest in shares or any other securities provided by corporations based in the United States. Because the United States accounts for the majority of the world's market value, American investors who currently own U.S. equities can diversify their portfolios geographically by purchasing money that the United States does not issue. It is possible that the majority of U.S. equities would be included in a global all-cap stocks fund if an American investor chose to participate in such a fund instead of a more traditional global stock portfolio. This would essentially nullify some of the diversification benefits.

Benchmark Ex-U.S. Index

It is a market-capitalization-weighted index meant to offer a comprehensive gauge of the performance of global stock markets. However, it does not include businesses domiciled in the United States. This MSCI ACWI Ex-U.S. index includes developing and emerging economies outside the United States.


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