Vanguard Total International Stock: The Ultimate Guide

Vanguard Total International Stock ETF (VXUS) is a diversified fund that provides investors with exposure to stocks from developed and emerging markets outside the United States. With over $100 billion in assets under management, VXUS is one of the largest and most popular international ETFs on the market.

Why Invest in Vanguard Total International Stock?

There are several reasons why investors may want to consider adding VXUS to their portfolio:

• Diversification: VXUS provides instant diversification across multiple countries and regions, reducing the risk of any single country's performance impacting your portfolio.
• Growth Potential: International markets have historically outperformed the U.S. market over the long term, providing potential for higher returns.
• Hedging Against Currency Risk: VXUS is hedged against currency fluctuations, meaning investors can benefit from international growth without the risk of currency losses.
• Low Fees: VXUS has an expense ratio of just 0.11%, making it one of the most cost-effective ways to gain international exposure.

Performance

VXUS has consistently outperformed the MSCI EAFE Index, a benchmark for international stock performance. Over the past 10 years, VXUS has returned an average of 10.3% per year, compared to 9.5% for the MSCI EAFE Index.

Holdings

VXUS holds over 8,000 stocks from over 90 countries. The fund is heavily weighted towards developed markets, with over 80% of its assets invested in companies in Europe, Asia, and Canada. The top 10 countries by weight include:

Fees and Expenses

VXUS has an expense ratio of 0.11%. This means that for every $10,000 invested, you will pay $11 in annual fees.

Tax Implications

VXUS is a U.S.-domiciled ETF, so it is subject to U.S. taxes. However, the fund is tax-efficient because it uses a sampling strategy to minimize the number of stocks that are sold for capital gains purposes.

Tips for Investors

When investing in VXUS, investors should consider the following tips:

• Long-Term Investment: VXUS is a long-term investment that should be held for at least five years.
• Periodic Rebalancing: Rebalance your portfolio regularly to maintain the desired asset allocation.
• Tax-Efficient Account: Consider holding VXUS in a tax-efficient account, such as an IRA or 401(k), to minimize taxes.
• Monitor Performance: Monitor the performance of VXUS regularly and re-evaluate your investment strategy as needed.

Tables

Table 1: VXUS Performance vs. MSCI EAFE Index

Table 2: VXUS Country Exposure

Table 3: VXUS Dividend Yield

Table 4: VXUS Historical Returns

Conclusion

Vanguard Total International Stock (VXUS) is a valuable addition to any portfolio. The fund provides diversified exposure to international stocks, which can enhance returns and reduce risk. With its low fees, tax efficiency, and strong performance history, VXUS is an excellent choice for investors looking to invest abroad.