There’s a certain…restlessness these days, isn’t there? Investors, turning their gaze beyond our own shores. It’s not necessarily optimism driving them, more a sense that perhaps, just perhaps, the rest of the world might offer something our own market doesn’t. Though, one suspects, they’ll find disappointment waiting, as it always does.
The Vanguard funds, VXUS and VYMI, offer a means to participate in this distant game. VXUS, the broader of the two, has enjoyed a recent ascent, outperforming the familiar indices. VYMI, focused on dividends, has fared even better. These gains, of course, are merely numbers on a screen, fleeting indicators of a reality far more complex. Still, one can’t help but notice.
VXUS, with its eight thousand-odd holdings, is a vast, impersonal collection. It includes the usual suspects – semiconductor giants, tech behemoths. It’s a map of global commerce, certainly, but a map viewed from a great height, lacking the details that truly matter. One wonders if anyone at Vanguard truly knows what resides within that fund.
Its composition is predictable: Europe, the Pacific, a smattering of emerging markets. Japan, the United Kingdom, China… the familiar pillars of the global economy. A low expense ratio, of course, is comforting. It’s a small concession to reason in a world largely governed by irrationality. But it doesn’t change the fact that one is simply buying a piece of everything, hoping something will grow.
VYMI, in contrast, is a more… deliberate construction. Fifteen hundred stocks, chosen for their dividends. A focus on income, on the tangible return of capital. It’s a slightly more comforting notion, perhaps. Though, one suspects, these dividends are often a sign of maturity, of limited growth potential. A quiet acceptance of one’s place in the world.
VYMI tilts towards Europe, away from the volatile promise of Asia. Roche, HSBC, Novartis… established names, reliable, if uninspiring. Toyota, a sturdy presence, enduring the shifting tides of the automotive world. It’s a portfolio built on stability, on the assumption that the world will continue to function much as it always has. A rather optimistic assumption, wouldn’t you say?
| Metric | Vanguard Total International Stock ETF (VXUS) | Vanguard International High Dividend Yield ETF (VYMI) |
|---|---|---|
| Number of stocks | 8,691 | 1,535 |
| Top five regions | Europe (37.9% of fund), Emerging Markets (26.6%), Pacific (26.4%), North America (7.8%), Middle East (0.8%) | Europe (43.6% of fund), Pacific (26.4%), Emerging Markets (21.1%), North America (7.9%), Middle East (0.8%) |
| Top five markets | Japan (15.1% of fund), United Kingdom (9%), China (8.5%), Canada (7.8%), Taiwan (6.4%) | Japan (14.2% of fund), United Kingdom (11.4%), Canada (7.9%), Switzerland (7.3%), Australia (6.7%) |
| Price to earnings (P/E) ratio | 17.5 | 13.9 |
| Average annual returns | 1 year: 39.6% 3 year: 19.8% 5 year: 9.8% 10 year: 10.6% | 1 year: 45.5% 3 year: 23% 5 year: 14.9% 10 year: 11.8% |
| Expense ratio | 0.05% | 0.07% |
Which to choose? VXUS offers breadth, a participation in the global economy, however diluted. VYMI offers a focus, a modest income stream, a sense of… solidity. The latter has performed better over the past decade, and trades at a more reasonable valuation. But past performance, as they say, is no guarantee.
Perhaps the better question is, what are we hoping to achieve? Wealth? Security? A fleeting sense of control in a chaotic world? These funds will not provide any of those things, not truly. They are merely a means of deferring the inevitable, of postponing the realization that the world is a fundamentally uncertain place. And so, we invest, and we wait, and the seasons change, and the market continues its relentless, indifferent march forward. It’s a quiet contemplation, isn’t it?
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2026-03-13 01:04