A Global ETF Excluding the United States Worth Keeping an Eye On

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Photo by Alina Grubnyak on Unsplash

Many of the largest publicly traded companies in the world by market cap are based in the United States. You can easily stay updated on them via an ETF such as the Vanguard 500 Index Fund (VOO). When it comes to staying up to date on the largest publicly traded companies globally by market cap based outside of the United States, there are ETFs for that. One of the leading ETFs for it is the Vanguard FTSE All-World ex-US Index Fund (VEU).

VEU is an ETF that seeks to track the performance of the FTSE All-World ex-US Index, which is an index that focuses on providing a convenient way to get broad exposure across developed and emerging non-U.S. equity markets around the world.

The top holdings of VEU include Tencent Holdings, Alibaba Group Holding, Nestle, ASML Holding, Roche Holding, Taiwan Semiconductor, Toyota, LVMH Moet Hennessy Louis Vuitton, and Novartis. As of May 11th, 2022, VEU has a price of $51.20 per share, an expense ratio of 0.07%, and net assets of $48.57 billion. Since its inception on March 2nd, 2007, VEU has provided a total return of approximately 51% and an average annual total return of 3%, with dividends reinvested.

The rest of the largest companies in the world excluding the United States by market cap have not provided the same returns as the largest companies in the United States by market cap. Since March 2nd, 2007, VOO has provided a total return of approximately 336% and an average annual total return of approximately 14%, with dividends reinvested.

I personally would not invest in VEU but rather use it to see how other large companies globally are performing in comparison and use that information to learn more about the stock markets and economies of the countries these companies are located in. Will VEU ever provide better returns than VOO? Let me know your opinion in the comments.