The author assigns a "hold" rating to VXUS, projecting accelerated growth combined with persistent inflation in the second half of the year—an unfavorable scenario for global ex-US equities; The US accounts for 64% of global market cap (up from 42% in 2008), supported by earnings that exceed the rest of the world. US, Japan, Eurozone, and ex-US equities are trading above their historical P/E averages, only emerging markets appear to be at fair value.
The Vanguard Total International Stock ETF (NASDAQ:VXUS) is the default choice for most investors who want exposure to companies outside the United States.
An international equity sleeve inside a taxable account has a quieter tax drag than a business development company (BDC) or mortgage real estate investment trust (REIT), but it is not trivial.
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The financial entity in question operates by adopting an indexing strategy aimed at mirroring the performance of the FTSE Global All Cap ex US Index. This index is notable for being a float-adjusted, market-capitalization-weighted index, with a focus on tracking the equity market performance of companies situated in both developed and emerging markets, uniquely excluding those based in the United States. This signifies a comprehensive approach to investment, emphasizing a global diversification strategy that deliberately omits US-based equities. The objective behind this methodology is to provide investors a pathway to participate in the growth and returns of international markets by investing in a broad spectrum of companies across various countries and sectors.
This product is centered around an investment strategy that seeks to replicate the performance of the FTSE Global All Cap ex US Index. Through this approach, the firm caters to investors looking for exposure to international equity markets without the inclusion of US-based companies. By closely following the index, this method aims to minimize tracking error and ensure that the portfolio's performance closely aligns with that of the target index. The indexing investment approach is suitable for investors who prefer a passive investment strategy that leverages the potential growth and diversification benefits of international markets.
As part of its core offerings, the company provides a global equity investment fund that commits all, or nearly all, of its assets to the common stocks included in the FTSE Global All Cap ex US Index. This fund is designed for investors looking to diversify their investment portfolios beyond US borders, offering exposure to a wide array of companies located in both developed and emerging markets around the world. By investing in this fund, individuals can gain access to a diversified set of securities, which helps in spreading risk and potentially enhancing returns over the long term. The global equity investment fund is an ideal choice for those seeking an investment product that mirrors the performance of a broad, international equity index.