The Vanguard Total International Stock Index Fund ETF Shares (NASDAQ:VXUS) is a great option for investors that want some geographical diversification for their portfolio.
With more than 7,000 stocks spanning various continents, the ETF gives investors a lot of balance, particularly outside of North America where just 6.9% of the ETF’s holdings are based in. With North America looking like it may be headed for a slowdown, it may be more important than ever to invest in other parts of the world.
Some of the ETF’s top holdings include Nestle SA, Royal Dutch Shell plc (NYSE:RDS.A), and Toyota Motor Corp (NYSE:TM). However, even the top 10 holdings accounting for a little more than 9% of the fund’s total net assets.
That means investors can expect a lot of stability, with one stock not having too much of an impact on the overall ETF. And with a median market cap of $27.3 billion, investors can rest assured that these are not fringe companies that are being included in the name of diversification.
These are quality companies that are trading at very reasonable ratios, with the ETF averaging a price-to-earnings multiple of 14.4 and a price-to-book ratio of only 1.4. Those are great numbers of value investors and with a miniscule expense ratio of just 0.09%, the fund is run very efficiently.
Year to date, the ETF has risen 7% and as long as the global markets are doing well, investors can continue to expect good returns from the fund. While it won’t generate astronomical returns, it can help provide steady, long-term returns that will allow your portfolio to grow without taking on much risk.
