Vanguard Total International Stock ETF
Price
$87.97
YTD
+8.42%
Expense
0.07%
Yield
2.95%
Best International ETFs 2026
Diversify globally with the best international and emerging market ETFs.
International ETFs: Diversify Beyond US Borders
International ETFs provide exposure to stock markets outside the United States, offering diversification benefits that can improve long-term risk-adjusted returns. With US stocks comprising about 60% of global market capitalization, investors who only hold US stocks are ignoring 40% of the world's investment opportunities.
Developed vs. Emerging Markets
International ETFs fall into two categories: developed markets (Europe, Japan, Australia, Canada) and emerging markets (China, India, Brazil, Southeast Asia). Developed markets offer stability and dividend income, while emerging markets provide higher growth potential with greater volatility. A balanced international allocation includes both.
Currency Risk and Hedging
When you invest internationally, you gain exposure to foreign currencies. A strengthening US dollar reduces your international returns (and vice versa). Some international ETFs offer currency-hedged versions, but most advisors recommend accepting currency risk as part of the diversification benefit over long periods.
The Case for International Diversification
From 2000-2009, international stocks dramatically outperformed US stocks. From 2010-2024, US stocks led. These cycles rotate, and no one can predict which will lead next. Maintaining 20-40% international allocation ensures you participate in whichever region leads over the coming decade.
🏆 Winner — #1 pick
iShares Core MSCI EAFE ETF
Price
$100.95
YTD
+8.50%
Expense
0.07%
Yield
2.85%
Vanguard FTSE Emerging Markets ETF
Price
$60.99
YTD
+6.85%
Expense
0.08%
Yield
2.85%
iShares Core MSCI Emerging Markets ETF
Price
$82.29
YTD
+6.80%
Expense
0.09%
Yield
2.55%
iShares MSCI ACWI ex U.S. ETF
Price
$78.09
YTD
—
Expense
0.32%
Yield
—
iShares MSCI ACWI ETF
Price
$161.94
YTD
—
Expense
0.32%
Yield
—
Frequently asked questions
Why should I invest in international ETFs?
International ETFs provide diversification beyond US markets, which represent only 60% of global market cap. Different countries and regions often perform well at different times — international diversification reduces portfolio risk and captures global growth opportunities.
What percentage of my portfolio should be international?
Most financial advisors recommend 20-40% international allocation. Vanguard suggests about 40% international based on global market cap weighting. A common approach is 30% international for a balanced domestic/global blend.
What are the best international ETFs?
VXUS (Vanguard Total International) and IXUS (iShares Core MSCI Total International) offer the broadest global coverage. IEFA covers developed markets, while VWO and IEMG focus on emerging markets. A combination provides complete international exposure.
Do international ETFs pay dividends?
Yes, international ETFs generally pay higher dividend yields than US ETFs because many foreign companies distribute more of their earnings. International dividend yields typically range from 2.5-4%, compared to 1.5-2% for US broad market ETFs.
What are the risks of international investing?
Key risks include currency fluctuation, political instability, different accounting standards, and lower liquidity in some markets. Emerging markets add additional risks like capital controls and regulatory uncertainty. Diversifying across multiple regions mitigates these risks.