Many investors have domestic stock portfolios and would like to complement them with exposure to international equities. However, a large number of international equity funds still invest a portion of their assets in companies based in the U.S. 

For investors who want pure international equity exposure without it being diluted by more American companies, a global ex-U.S. exchange-traded fund (ETF) may be the best option. These funds invest in stocks all over the world while making a point to avoid investing in the U.S. The following is a list of three of the largest global ex-U.S. equity ETFs by assets under management (AUM).

Key Takeaways

  • Investors looking to invest beyond the U.S. should consider purely international ETFs, also known as global ex-U.S. ETFs. 
  • The largest global ex.U.S. stock ETF is the Vanguard FTSE All-World ex-US ETF (VEU), which as $25 billion in assets under management (AUM). This fund mostly invests in the Asia-Pacific and European regions. 
  • Two other notable ETFs for investors seeking international exposure are the Vanguard Total International Stock ETF (VXUS) and iShares MSCI ACWI ex-U.S. ETF (ACWX), with $17.6 billion and $4.1 billion AUMs, respectively. 

Vanguard FTSE All-World ex-US ETF (VEU)

The Vanguard FTSE All-World ex-US ETF was the largest global ex-U.S. fund available as of Nov. 14, 2019, with $25 billion in AUM. The fund offers a convenient way to get broad exposure across developed and emerging non-U.S. equity markets around the world. It is a passively managed fund that uses index sampling and seeks to track the performance of the FTSE All-World ex-U.S. Index.

The fund invests in 3,328 different equities and has a weighted average market capitalization of $66 billion. Its top 10 holdings equal 9.2% of the portfolio. As for regional exposure, the portfolio is allocated as follows: 45% in Asia-Pacific, 42.7% in Europe, 6.4% in North America, 3% in Latin America, and 2.9% in the Middle East & Africa. 

The top 10 countries the VEU is invested in include Japan, the U.K., Hong Kong, France, Switzerland, Canada, Germany, Australia, Korea, and Taiwan. The fund has an expense ratio of 0.09%. The distribution yield on the fund is 5.2%, with the ETF up 15% in the last year. 

Vanguard Total International Stock ETF (VXUS)

The Vanguard Total International Stock ETF is another major global ex-U.S. fund with $17.6 billion in AUM. The fund seeks to track the performance of a benchmark index that measures the investment return of stocks issued by companies located in developed and emerging markets, excluding the U.S. It is a passively managed fund that uses index sampling and seeks to track the performance of the FTSE Global All Cap ex-U.S. Index.

The portfolio is the most broadly invested ETF in this list, investing in 7,439 different equities, and has a weighted average market capitalization of $59 billion. As for regional exposure, the portfolio is allocated as follows: 45% in Asia-Pacific, 42% in Europe, 7.2% in North America, 3% in Latin America, and 2.8% in the Middle East & Africa. The top 10 countries the VXUS is invested in include Japan, the U.K., Hong Kong, Canada, France, Switzerland, Germany, Australia, Taiwan, and Korea. 

 The fund has an expense ratio of 0.09%. The fund’s distribution yield is 5.3% and it has a one-year return of 14.7%.

iShares MSCI ACWI ex-U.S. ETF (ACWX)

A larger, but still large by ETF standards, total market global equity ex-U.S. ETF is the iShares MSCI ACWI ex-U.S. ETF with $4.1 billion of AUM. This fund seeks to provide investors access to the global equity markets, excluding the United States, including developed and emerging market economies. It is primarily suitable for an investor looking for long-term growth. The fund tracks the MSCI ACWI ex USA Index.

The portfolio is invested in 1,352 different holdings. The fund's top-10 weighted countries comprise almost 73% of the portfolio. They are Japan, the U.K., Hong Kong, France, Canada, Switzerland, Germany, Australia, Korea, and Taiwan. 

The three most heavily invested sectors total 49% of the portfolio. They are financials, technology, and industrials. The distribution yield for the ACWX is 2.4% and has posted an 11.6% one-year return.