Is the Vanguard FTSE All-World ex-US Index Fund ETF (VEU) the Smartest Investment You Can Make Today?
Key Points
The Vanguard FTSE All-World ex-US Index Fund ETF contains many hundreds of stocks from countries around the globe.
It includes both developed and developing markets.
It's a solid dividend payer, too.
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If you're at least a little bit worried about how the American economy is going to fare in the years ahead, what with tariff wars, the war with Iran, general global unrest, and so on, you might be seeking some investments that are focused outside our borders -- for diversification's sake.
A fine investment to consider for your long-term portfolio is the Vanguard FTSE All-World ex-US Index Fund ETF (NYSEMKT: VEU). It's an exchange-traded fund (ETF) -- a fund that trades like a stock, meaning that you buy as many or as few shares of it as you want, from pretty much any good brokerage.
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Here are some things to know about the Vanguard FTSE All-World ex-US Index Fund ETF, along with some reasons to consider it.
For starters, as a Vanguard fund, it sports very low fees. Its expense ratio (annual fee) is just 0.04%. So for every $10,000 you have invested in it, you'll pay only $4 per year in fees.
It's an index fund, and it tracks the FTSE All World ex-US Index. That index features around 3,760 stocks, both large and mid-sized, from both developed countries and emerging markets. As you might guess from its name, it intentionally does not include U.S. stocks. So, for example, it recently had 107 holdings from Australia, 57 from France, 66 from Hong Kong, 34 from Mexico, 68 from Brazil, 272 from India, 156 from Korea, and a whopping 1,275 from China. Stocks from developed nations lend some stability to the index, while those from emerging markets (such as Brazil and India) may be able to grow faster. It's a nice balance.
But wait -- there's more! The ETF is also a dividend payer, recently yielding 2.9%. Given that the long-term average rate of inflation is around 3%, such a yield can help you keep up with inflation. And receiving meaningful income from an investment is simply a wonderful thing, as it can provide funds to live off of in retirement (without requiring the selling of any shares) or funds to reinvest in more shares of stock.
Here's how it has performed recently:
|
Period |
Average Annual Gain |
|---|---|
|
1 year |
37.97% |
|
3 years |
17.31% |
|
5 years |
8.42% |
|
10 years |
9.20% |
|
15 years |
6.25% |
Data source: Morningstar.com, as of April 20, 2026.
And here are its recent top holdings:
|
Holding |
Weight in ETF |
|---|---|
|
Taiwan Semiconductor Manufacturing |
3.81% |
|
Samsung Electronics |
1.50% |
|
ASML Holding |
1.41% |
|
Tencent Holdings |
1.07% |
|
SK Hynix |
0.84% |
|
Novartis AG |
0.80% |
|
AstraZeneca PLC |
0.80% |
|
HSBC Holdings |
0.77% |
|
Roche Holding |
0.77% |
|
Alibaba Group |
0.77% |
Data source: Morningstar.com, as of April 20, 2026.
The preceding table shows how unconcentrated the ETF is. Many U.S. index funds, in contrast, are heavily weighted in the "Magnificent Seven" stocks, such as Nvidia and Apple. You're probably familiar with a few of the listed stocks, too, and may think rather highly of them. Taiwan Semiconductor Manufacturing, for example, is a major player in the fast-growing semiconductor realm.
If you're intrigued, take a closer look at this ETF -- and know that there are many other exciting ETFs out there, too.
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HSBC Holdings is an advertising partner of Motley Fool Money. Selena Maranjian has positions in ASML, Apple, HSBC Holdings, Novartis, Nvidia, Roche Holding AG, and Taiwan Semiconductor Manufacturing. The Motley Fool has positions in and recommends ASML, Apple, AstraZeneca Plc, Nvidia, Taiwan Semiconductor Manufacturing, Tencent, and Vanguard International Equity Index Funds-Vanguard Ftse All-World ex-US ETF. The Motley Fool recommends Alibaba Group, HSBC Holdings, and Roche Holding AG. The Motley Fool has a disclosure policy.
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