VXUS Tops $100B as ETF Investors Embrace International Stocks
- VXUS reached $100 billion in assets under management as of July 25.
- The international stock index ETF has attracted $9.9B in inflows this year.
The Vanguard Total International Stock Index Fund ETF (VXUS) crossed a major milestone on Friday, reaching $100 billion in assets under management.
It’s now the fourth-largest international equity ETF in the U.S., trailing only the Vanguard FTSE Developed Markets ETF (VEA), the iShares Core MSCI EAFE ETF (IEFA) and the iShares Core MSCI Emerging Markets ETF (IEMG).
VXUS Takes a Broad View
Among that group, VXUS is by far the broadest. It tracks the FTSE Global All Cap ex US Index, which covers large-, mid- and small-cap stocks from both developed and emerging markets. As of today, the fund holds 8,561 stocks, with emerging markets making up just over a quarter of the portfolio.
Top holdings include Taiwan Semiconductor Manufacturing Co. (TSM), which represents about 2.5% of assets, followed by Tencent Holdings (TCEHY) at 1.1%, ASML Holding (ASML) and SAP SE (SAP) each around 0.9%, and Alibaba Group Holding (BABA) at 0.7%.
VXUS has attracted $9.9 billion in inflows this year, the seventh-highest among all U.S.-listed ETFs. That momentum reflects renewed investor interest as international stocks outperform. Year to date, VXUS is up 19.3%, more than double the S&P 500’s 9.3% return.
Factors Driving International Resurgence
Several factors have driven the resurgence. Concerns about the U.S. trade war and tariffs have shifted attention abroad, while a weaker U.S. dollar has boosted returns for international equities. The U.S. Dollar Index has declined 9% this year, giving a lift to dollar-based investors in unhedged foreign stocks.
The currency impact is evident when comparing VXUS to hedged strategies. Funds like the Xtrackers MSCI EAFE Hedged Equity ETF (DBEF) and the iShares Currency Hedged MSCI EAFE ETF (HEFA) are up 11.4% this year—solid returns but well below the gains seen in unhedged vehicles like VXUS.
After a long stretch of underperformance, international stocks look relatively cheap compared to their U.S. counterparts.
For investors seeking low-cost, diversified exposure to equity markets outside the U.S., VXUS remains one of the most comprehensive options available. It charges an expense ratio of just 0.05%.
