This Low-Cost ETF Holds Almost 8,800 Stocks Across Both Developed and Emerging Markets. Here's Why It's a Compelling Long-Term Core Holding

Investors seeking to diversify their portfolios may find the Vanguard Total International Stock ETF (VXUS) an appealing option, especially if they are heavily weighted in U.S. equities. This low-cost index fund, which has gained 2.65% recently, provides exposure to nearly 8,800 international stocks across developed and emerging markets, with notable holdings in well-known companies like Taiwan Semiconductor, Samsung, AstraZeneca, and Alibaba.

The significance of VXUS lies in its potential to mitigate risks associated with U.S. market fluctuations and currency volatility. Currently, international stocks within this ETF trade at an average price-to-earnings ratio of about 17, compared to over 25 for U.S. equities, indicating a substantial valuation gap. This makes VXUS not only a strategic diversification tool but also an attractive entry point for investors looking to capitalize on undervalued international markets.

For market professionals, the Vanguard Total International Stock ETF represents a compelling opportunity to enhance portfolio resilience while accessing growth in global markets at a minimal cost, given its low 0.05% expense ratio and significant existing investor base of nearly $600 billion.

Source: fool.com