9 Best International ETFs To Buy (6 From Vanguard) in 2024

International assets are a crucial part of any well-diversified investment portfolio. Here we’ll look at the best international ETFs for both stocks and bonds across developed and emerging markets.
// TIMESTAMPS:
00:00 - Intro - Why International Stocks and Bonds?
02:26 - VXUS
02:47 - VEU
03:25 - IXUS
03:53 - VEA
04:11 - VWO
05:20 - BNDX
05:56 - IAGG
06:25 - IGOV
06:48 - VWOB
07:30 - Outro
// SUMMARY:
So why would we be interested in international stocks and bonds in the first place?
International stocks inarguably offer a diversification benefit by not being perfectly correlated to the U.S. market. That is, international stocks do not move in perfect lockstep with U.S. stocks.
At their global market weight, U.S. stocks comprise only about 50% of the global stock market. Top target date funds now allocate over 30% of equities positions to ex-US stocks. Moreover, considering the historical performance of emerging markets, excluding international stocks may mean missing out on great investment opportunities. Also consider that international markets contain most of the largest automotive, telecommunication, and electronics companies.
No single country consistently outperforms all the others in the world. If one did, that outperformance would also lead to a relative overvaluation and a subsequent reversal. Meb Faber found that if you look at the past 70 years, the U.S. stock market has outperformed foreign stocks by 1% per year, but all of that outperformance has come after 2009.
In short, geographic diversification in equities has huge potential upside and little downside for investors.
Now we'll go over the 9 best international ETFs, segmented by asset type:
VXUS - Vanguard Total International Stock ETF
VEU - Vanguard FTSE All-World ex-US ETF
IXUS - iShares Core MSCI Total International Stock ETF
VEA - Vanguard FTSE Developed Markets ETF
VWO - Vanguard FTSE Emerging Markets ETF
BNDX - Vanguard Total International Bond ETF
IAGG - iShares Core International Aggregate Bond ETF
IGOV - iShares International Treasury Bond ETF
VWOB - Vanguard Emerging Markets Government Bond ETF
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#etfs #indexfunds #diversification
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[@OptimizedPortfolio]

What international ETFs do you own or plan to buy?

[@Kep19901]

VYMI, VSS, VEA and VWO

[@OptimizedPortfolio]

@@Kep19901 Thanks for sharing! Those sound like some nice choices.

[@maximilianoibarra9747]

Great video bro!

[@OptimizedPortfolio]

Thank you!

[@kwuq9179]

10/10 I needed some International Diversified ETF. 10 minutes later I had what I need. Good job man really concise video :)

[@OptimizedPortfolio]

Thanks!

[@alejandroarteaga92]

I wanna get for my portfolio these 6 etfs im not to sure if its a good balance though they are vxus,vug,vti,vea,vwo,VIg

[@Beck-Stein]

Why not replace vanguard etfs with equivalent avantis and dgs funds in ginger ale portfolio? Lower expense ratios.

[@OptimizedPortfolio]

Use more words, please. I never know exactly what you're saying or asking.

[@danielng2782]

How about a combination of VT and BNDW for most simple and internationally diversified portfolio?

[@OptimizedPortfolio]

Simple and effective.

[@TJ-Stackin]

Just a quick question. In a taxable account, would you still hold VOO,AVUV,VEA,AVDV,VWO,DGS,EDV?

[@OptimizedPortfolio]

Probably not, but I also wouldn't let the tax tail wag the dog.

[@sumitomoO0O]

The dividends from non-US companies may not be qualified for tax purposes. Is the long term cap gains from non-US companies still taxed at lower rates?

[@OptimizedPortfolio]

Insofar as the foreign tax credit Americans get on foreign holdings, yes.

[@Kep19901]

Whats your take on VYMI?

[@OptimizedPortfolio]

It's a decent international large cap value fund.

[@Kep19901]

@@OptimizedPortfolio I use it on my portfolio. Only about 7%

[@OptimizedPortfolio]

@@Kep19901 Awesome!

[@stevec.7017]

Love VYMI

[@Kep19901]

@@stevec.7017 why?

[@chittu1980]

I like schwabs SCHF

[@OptimizedPortfolio]

Thanks for sharing!

[@christopherriccobono1419]

Where are the international ETFs from DFA & Avantis funds?

[@OptimizedPortfolio]

Like I said in another comment already, those are arguably unsuitable for novices, which is most of my audience, and I've got a video on Avantis funds coming in a few weeks. These broad low cost index funds here would be suitable for both novices and seasoned investors.

[@christopherriccobono1419]

​i enjoy your work a lot. I am 100% Avantis in my retirement accounts. I see the added value. I look forward to the content you have soon on Avantis funds

[@OptimizedPortfolio]

@@christopherriccobono1419 Thanks!

[@grigorirasputin425]

No mention of Avantis funds for some reason

[@humanbeingmatt4811]

He has said on his blog that AVDE is similar VEA but not worth the extra cost. It was worth the extra cost last year though

[@grigorirasputin425]

@@humanbeingmatt4811 what about AVEM, AVDV etc?

[@humanbeingmatt4811]

@@grigorirasputin425 I believe he said he’s long both of those funds

[@grigorirasputin425]

@@humanbeingmatt4811 then I guess he doesn’t consider them “best” since they are not in this video

[@humanbeingmatt4811]

@@grigorirasputin425or Avantis isn’t sponsoring his youtube content