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9 Best International ETFs to Buy in 2021

When you first start investing, chances are you’ll keep your investment portfolio domestic. After all, everything you’ve read has told you to invest in what you know, and unless you study international markets, you’re more comfortable investing in stocks representing companies that sell products or services you use.

As you build your wealth and research new opportunities, you’ll likely come across information about international stocks that will pique your interest. These stocks trade on stock markets around the world and aren’t often household names in the United States.

Due to volatility in global markets, choosing the best opportunities on an individual-stock basis requires extensive research. However, you can gain exposure to the international market with much less research by investing in exchange-traded funds, or ETFs.

Moreover, international funds provide a high level of diversification, protecting your overall portfolio from significant declines should one or two of the stocks in the fund fall on hard times.

Best International ETFs

Exchange-traded funds are some of the most popular investment vehicles on Wall Street today. So naturally, there are tons of international funds to choose from.

Where do you start?

Some of the best international ETFs on the market today include:

1. Vanguard FTSE Developed Markets ETF (VEA)

It’s difficult to talk about the top ETFs in any category without mentioning Vanguard. Founded in 1975, the fund management firm has decades of experience delivering compelling gains along with industry-low costs, making it one of the clear leaders in the fund-management arena.

The fund was designed to provide exposure to international stocks in developed regions ranging in market capitalizations from small-cap to large-cap.

More than half of the fund’s assets are invested in Europe, with the next largest holdings being in the Pacific region of the world. Under 9% of the fund’s assets are invested in North America, with the vast majority of those investments being in Canada.

Key Stats

As with most Vanguard funds, the ETF comes with an industry-low expense ratio while providing an impressive historic performance. Here are the key stats:

  • Asset Allocation: The fund’s portfolio is made up of international stocks with a range of market caps. The top five holdings in the portfolio include Samsung Electronics (005930.KS), Nestle (NESN), Roche Holdings (ROG), ASML Holding (ASML), and Novartis (NOVN).
  • Expense Ratio: The annual cost associated with the fund is just 0.05%. Considering the average cost of ETFs sits at 0.44% according to Experian, this fund lets you hold onto far more of your gains than most other options.
  • Historic Performance: The returns on the fund have been impressive, to say the least. Over the past year, investors have enjoyed returns of 24.58%. According to Yahoo! Finance, the average return for the category throughout the past year has been just 8.19%. Over the past three- and five-year periods, returns have come in at 5.48% and 10.58%, respectively.
  • Dividend Yield: The dividend yield on the fund is 2.21%, making it a great investment for those looking to generate income through their stock market portfolio or giving you the opportunity to reinvest your dividends and expand your earnings potential.
  • Morningstar Return Rating: The Morningstar rating on the ETF is 4 out of 5 stars, making it one of the highest-rated international funds on the market today.
  • MSCI ESG Rating: Morgan Stanley Capital International (MSCI) rates funds according to their resilience to environmental, social, and governance (ESG) risks. The MSCI ESG score on this fund is 7.19 out of 10, according to ETF.com, which gives the fund an ESG rating of AA, making it a strong potential option for impact investors.

Pro tip: Have you considered hiring a financial advisor but don’t want to pay the high fees? Enter Vanguard Personal Advisor Services. When you sign up, you’ll work closely with an advisor to create a custom investment plan that can help you meet your financial goals. Read our Vanguard Personal Advisor Services review.


2. Vanguard Total International Stock ETF (VXUS)

The Vanguard Total International Stock ETF is another fund that’s well worth your attention. The fund was designed to provide diversified exposure to both emerging and developed markets around the world.

When you invest in the fund, you’ll gain exposure to developed economies like Canada, the United Kingdom, and Europe, as well as exposure to emerging economies like China and Brazil.

The fund uses the FTSE Global All Cap ex-US Index as its benchmark, which tracks more than 5000 companies in global markets across all market capitalizations while excluding investments in U.S. companies.

Key Stats

As investors have come to expect from Vanguard funds, the VXUS comes with industry-low expenses, but you won’t be giving up returns in exchange for the discount.

  • Asset Allocation: The fund’s investment portfolio includes a heavily diversified mix of international stocks with market caps ranging from small to large. The top five holdings in the portfolio include Taiwan Semiconductor Manufacturing (TSM), Tencent Holdings (TCEHY), Alibaba Group Holding (BABA), Samsung Electronics (005930.KS), and Nestle (NESN).
  • Expense Ratio: The ETF comes with an expense ratio of 0.08% per year, well below the industry average.
  • Historic Performance: Over the past year, investors in the fund have enjoyed returns of 25.81%, more than triple the category average. Over the past three and five years, returns have come in at 5.69% and 11.37%, respectively, both of which are significantly above average for international funds.
  • Dividend Yield: The dividend yield on the fund is 2.11%, making it another popular option among income investors and those interested in reinvesting their dividends to expand their earnings potential.
  • Morningstar Return Rating: The fund’s Morningstar rating is 3 out of 5 stars.
  • MSCI ESG Rating: The ESG score on the fund is 6.48 out of 10, giving the fund an A rating, meaning the fund is slightly above average when it comes to impact made through its investments.

3. iShares Core MSCI Total International Stock ETF (IXUS)

iShares is another fund management firm that’s hard to ignore when making a list of the best funds in any category, including international equity ETFs. Founded in 2000, iShares has quickly grown to become one of the most respected fund managers on Wall Street.

The iShares Core MSCI Total International Stock ETF was designed to provide diversified exposure to the total stock market while excluding investments in U.S. stocks. Like others on this list, the fund’s portfolio includes a mix of small-, medium-, and large-cap companies.

Key Stats

iShares is another fund manager known for providing funds with incredibly low expenses and compelling performance, and this fund doesn’t disappoint. The key stats are as follows:

  • Asset Allocation: The fund provides diversified exposure to the global market, including both emerging and developed regions outside of the United States. The top five holdings in the fund include Taiwan Semiconductor Manufacturing (TSM), Tencent Holdings (TCEHY), Alibaba Group Holding (BABA), Samsung Electronics (005930.KS), and Nestle (NESN).
  • Expense Ratio: The annual price you’ll pay when you invest in this fund is 0.09%, which is far below the industry average.
  • Historic Performance: The performance of the fund has been impressive. Over the past year, the ETF produced returns in the amount of 26.21%. Throughout the past three and five years, returns have come in at 5.69% and 11.41%, respectively.
  • Dividend Yield: With a dividend yield of around 1.85%, the fund isn’t the highest payer on this list, but the income offered is attractive.
  • Morningstar Return Rating: With a rating of 4 out of 5 stars, the fund ranks among the top in the space.
  • MSCI ESG Rating: The ETF has an ESG score of 6.45 out of 10, giving it an A rating. This means the fund is a potential option for those looking to make an impact with their investing dollars.

4. Vanguard FTSE Emerging Markets ETF (VWO)

All funds on this list so far focus on either investments in developed markets or investments in a mix of developed and emerging markets. However, if you’re looking for diversified exposure focused purely on emerging economies around the world, the Vanguard FTSE Emerging Markets ETF may just be the way to go.

As with any emerging market investment, the VWO ETF comes with high potential for growth, but also a higher level of risk. Designed to track the FTSE Emerging Markets All Cap China A Inclusion Index, assets in the fund are invested in emerging economies like China, Brazil, Taiwan, and South Africa.

Moreover, the fund’s portfolio includes a diversified list of stocks ranging in market capitalization from small-cap to large-cap.

Key Stats

With an incredibly low cost of investment and a history of generating strong returns, the VWO ETF has captured the attention of investors. Here are the key stats:

  • Asset Allocation: The fund is focused on investments stocks with ranging market capitalizations in emerging markets. The five largest holdings in the ETF include Tencent Holdings (TCEHY), Alibaba Group Holding (BABA), Taiwan Semiconductor Manufacturing (TSM), Meituan (MPNGF), and Naspers (NPSNY).
  • Expense Ratio: The annual cost associated with investing in the fund is 0.10%, well below the industry average.
  • Historic Performance: As you would hope to see with an ETF focused on emerging markets growth, the returns generating through the fund have been impressive. Over the past year, investors in the fund have experienced returns of 32.43%, with gains for the past three and five years clocking in at 6.52% and 14.29%, respectively.
  • Dividend Yield: With a dividend yield of 1.87%, this fund doesn’t provide the highest dividend payments on this list, but it does provide respectable income to look forward to.
  • Morningstar Return Rating: The ETF has a rating of 3 out of 5 stars.
  • MSCI ESG Rating: The ESG score on the fund is 4.57 out of 10, meaning that its ESG rating is BBB. With this rating, the fund slightly underperforms its peers in terms of social and environmental impact. As such, impact investors may want to look elsewhere.

5. Invesco China Technology ETF (CQQQ)

Invesco is another well-respected fund manager on Wall Street. While the company’s funds tend to have higher expense ratios, it’s also known for producing funds that perform well in comparison to the overall market.

The Invesco China Technology ETF is no different.

This fund is designed to closely track the FTSE China Incl A 25% Technology Capped Index, an index made up of mid- and large-cap technology companies in China. In fact, at least 80% of the assets held in the portfolio are invested in the stocks that make up the index.

Key Stats

As mentioned above, the costs associated with the fund leave a bit to be desired, but the returns generated are hard to ignore. Here are the key stats.

  • Asset Allocation: The vast majority of the fund’s portfolio is held in Chinese technology stocks. The top five holdings in the portfolio include Baidu (BIDU), Tencent Holdings (TCEHY), Meituan (MPNGF), Sunny Optical Technology (SOTGY), and Tencent Music Entertainment Group (TME).
  • Expense Ratio: Investors in the fund will pay 0.70%. That’s a fair bit above the average for the industry, which could prove to be quite costly as it cuts into compound gains over the long run. Nonetheless, with compelling returns providing a balance, the fund is still worthy of being on a list of the top international ETFs.
  • Historic Performance: This is where the fund shines. Over the past year, investors have earned a whopping 74.21%, with three- and five-year returns sitting at 15.11% and 25.48%, respectively.
  • Dividend Yield: With a dividend yield of just 0.49%, this fund isn’t one that’s known for generating significant income.
  • Morningstar Return Rating: This fund has a rating of 4 out of 5 stars.
  • MSCI ESG Rating: The ESG score for the fund is just 3.64 out of 10, giving it a BB rating. This means the fund’s investments don’t make much of a positive social or environmental impact, which may be a turn-off to some investors.

6. Schwab Emerging Markets Equity ETF (SCHE)

Schwab has been around for decades and has been providing meaningful returns for investors just as long. So, when you invest in the Schwab Emerging Markets Equity ETF, you know your money is in more-than-capable hands.

The fund was designed to track the returns of the FTSE Emerging Index — derived from the FTSE Global Equity Index Series, which represents more than 99% of the world’s investable market capitalization. The FTSE Emerging Index is one of the most comprehensive emerging market benchmarks in the world, making this fund one of the most highly diversified on this list.

The fund invests in stocks from countries like China, Brazil, and Taiwan. As with any emerging economy funds, the growth potential is incredible but the risks are increased.

Key Stats

Schwab is another fund manager on this list known for providing lower-than-average costs with above-average returns. Here are the key stats:

  • Asset Allocation: The majority of this fund’s portfolio is invested in emerging market mid-cap and large-cap stocks. The five largest holdings in the fund’s portfolio include Taiwan Semiconductor Manufacturing (TSM), Tencent Holdings (TCEHY), Alibaba Group Holding (BABA), Meituan (MPNGF), and Naspers NPSNY.
  • Expense Ratio: Investors pay 0.11% annually in expenses, which is well below the industry average. So, you’ll keep more of your gains.
  • Historic Performance: While expenses are low with this fund, its returns are nothing to shake a stick at. In the past year, investors in the fund have enjoyed gains of more than 32%, with three- and five-year returns coming in at 6.53% and 14.68%, respectively.
  • Dividend Yield: With a dividend yield of 3.46%, the SCHE ETF is known for offering considerable dividend payments. As such, it’s a great option for income investors looking for diversified exposure to emerging markets.
  • Morningstar Return Rating: The rating on the fund is 3 out of 5 stars, pointing to returns that are slightly above average.
  • MSCI ESG Rating: The ESG score for the ETF is 4.57 out of 10, giving it a BBB rating. This means that in terms of environmental and social impact, the fund ranks slightly below average.

7. Global X FTSE Nordic Region ETF (GXF)

Founded in 2008, Global X is by far the youngest fund manager on this list. However, the company has made a splash on Wall Street, providing outstanding returns to investors in their offerings.

The same can be expected from the Global X FTSE Nordic Region ETF.

The fund was created to provide investors with highly diversified exposure to the Nordic region, including investments in Finland, Sweden, Norway, and Denmark. The fund tracks the FTSE Nordic 30, a fund made up of the 30 largest and most liquid stocks in those four countries.

As a result, it’s not as diversified as others on this list, which will expose your portfolio to risk should economic and market conditions in the Nordic region decline.

Key Stats

The GXF ETF has been an impeccable performer, especially over the past year, making it an attractive opportunity for investors looking to achieve market-leading growth. Here are the key stats:

  • Asset Allocation: The fund’s holdings consist of the largest and most liquid stocks trading in the Nordic region. The top five holdings in the fund include Novo Nordisk (NVO), Vestas Wind Systems (VWS), Telefonaktiebolaget (ERIC), DSV Panalpina (DSV), and Volvo (VLVLY).
  • Expense Ratio: Investors pay 0.51% per year to own shares in the fund. That’s a tick over the industry average, but the slight increase in cost is reasonable considering the performance of the fund.
  • Historic Performance: This is where the GXF fund shines. Over the past year, returns have clocked in at 35.91%, with three- and five-year returns coming in at 8.83% and 9.85%, respectively.
  • Dividend Yield: Historically, dividend yields for the fund have been in the low-2% to mid-3% range. However, the yield fell significantly to just 1.13% at the close of 2020. So, although it has historically been a strong play for dividend investors, recent income hasn’t been quite as attractive.
  • Morningstar Return Rating: This fund is not rated by Morningstar.
  • MSCI ESG Rating: With an ESG score of 9.27 out of 10 and an ESG rating of AAA, the fund is known for making a meaningful social and environmental impact through its investments, making it a strong option for investors looking to do the same.

8. Invesco International Dividend Achievers ETF (PID)

As its name suggests, the Invesco International Dividend Achievers ETF is a fund designed for investors with a focus on income from international stocks.

Tracking the Nasdaq International Dividend Achievers Index, the fund invests in a highly diversified list of common stock from issuers around the world. The index is made up of non-U.S companies with at least five consecutive years of increasing annual regular dividend payments.

The fund invests in a mix of non-U.S. stocks that have qualified as international dividend achievers as well as American and global depository receipts.

Importantly, the assets held in the portfolio have generally increased dividend payments consistently over the past five years, making the fund a strong option for investors looking to generate income through their portfolios.

Key Stats

As a dividend-focused fund, price appreciation is slightly lower than would be expected in other international ETFs. However, the reduced price growth is made up for in strong dividends. Here are the key stats:

  • Asset Allocation: The fund is aimed at investing in international stocks that are known for producing consistently increasing dividends. The portfolio is built up of stocks from around the world, most of which trade with large market capitalizations, and many of which operate in the energy and utilities sectors. The top five holdings in the fund include GasLog Partners (GLOP), Novolipetsk Steel (NLMK), Hoegh LNG Partners (HMLP), Brookfield Property Partners (BPY), and Enbridge (ENB).
  • Expense Ratio: Investors will pay 0.53% on an annual basis, which is slightly above the industry average.
  • Historic Performance: Price appreciation over the years has been lighter than other funds mentioned on this list, although the dividends make up a good bit of the difference. Nonetheless, over the past year, investors have enjoyed returns of 9.27%, with three- and five-year returns coming in at 4.21% and 8.90%, respectively. It’s also worth mentioning that because of the fund’s aim at producing dividends, volatility is quite a bit lower than with other international ETFs, ultimately making it a strong play for investors looking for a lower-risk opportunity to profit from international markets.
  • Dividend Yield: The dividend yield on the fund is 3.04%, making it a strong option for investors looking to generate income through their investment portfolio.
  • Morningstar Return Rating: The Morningstar rating on the ETF is 3 out of 5 stars, suggesting returns are slightly above what you would expect to see when investing in a dividend-heavy fund like this.
  • MSCI ESG Rating: The ESG score on the fund is 7.11 out of 10, giving it an A rating. As a result, the fund makes a compelling option for impact investors.

9. Cambria Foreign Shareholder Yield ETF (FYLD)

Founded in the year 2000, Cambria is a relatively young fund manager that has made a splash on Wall Street, generating outsize profits for those who invest in their funds.

The Cambria Foreign Shareholder Yield ETF is designed to provide exposure to foreign stocks in developed economies with market caps greater than $200 million. Moreover, when adding companies to the portfolio, Cambria looks for stocks that have the best combined rank of dividend payments and share buybacks, which displays strong financial strength.

The fund’s investment portfolio consists of more than 100 stocks, offering up strong diversification and protecting investors from volatility risk.

Key Stats

While expenses associated with the fund are higher than average, returns have been well above average, and dividend payments have been impressive. Here are the key stats:

  • Asset Allocation: The fund’s goal is to provide diversified access to global stocks with market caps of $200 million or above that offer either impressive dividends, share buybacks, or a mix of both. The top five holdings in the portfolio include Magna International (MGA), Rio Tinto (RTNTF), Fortescue Metals Group (FSUGY), Rexel (RXEEY), and Munchener Ruckversicherungs-Gesellschaft (MURGY).
  • Expense Ratio: The fund comes with an annual cost of 0.59%, somewhat above the industry average. Although the expenses are higher, some of the best returns and impressive dividends make the fund hard to ignore.
  • Historic Performance: The fund’s performance has been worthy of attention. In the past year, investors earned 32.46% on their investments, with three- and five-year returns coming in at 4.14% and 10.91%, respectively.
  • Dividend Yield: Offering a dividend yield of 3.00%, the ETF is an impressive option for income investors.
  • Morningstar Return Rating: With a return rating of 4 out of 5 stars, the fund is known for above-average performance.
  • MSCI ESG Rating: The ESG score on the fund is 7 out of 10, giving it an A rating and making it an attractive option for investors looking to make a social and environmental impact with their investments.

Final Word

Exchange-traded funds are a great way to gain exposure to any group of stocks or other assets you might be interested in. If you’re looking to jump into the world of international investing, international ETFs offer a simplified approach.

Although there’s much less research involved when investing in ETFs than there is when investing in individual stocks, remember that not all investment-grade funds are created equal. Before diving in, pay close attention to historic performance, expenses associated with the fund, dividend yield, and the assets the fund invests in.

Also, if you’re interested in making a social and environmental impact with your investments, look to ESG scores to see how the fund’s assets are making a difference.

Joshua Rodriguez
Joshua Rodriguez has worked in the finance and investing industry for more than a decade. In 2012, he decided he was ready to break free from the 9 to 5 rat race. By 2013, he became his own boss and hasn’t looked back since. Today, Joshua enjoys sharing his experience and expertise with up and comers to help enrich the financial lives of the masses rather than fuel the ongoing economic divide. When he’s not writing, helping up and comers in the freelance industry, and making his own investments and wise financial decisions, Joshua enjoys spending time with his wife, son, daughter, and eight large breed dogs. See what Joshua is up to by following his Twitter or contact him through his website, CNA Finance.

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