A Peculiar Bargain: International Equities, 2026

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The market, you see, is a most curious beast. Here in America, valuations have ascended to a height that suggests either a profound collective delusion or a desperate scramble for air. The S&P 500, trading at twenty-three times earnings… it’s as if each share holds the promise of a personal serfdom, a lifetime of dividends barely enough to keep the wolves at bay. A bargain? One searches in vain, like a provincial governor seeking honesty amongst his officials.

One is thus compelled to cast a weary gaze across the ocean, to those lands where prudence, or perhaps simply a lack of speculative fervor, still holds sway. The indices there, bless their quiet dignity, trade at a discount – a most agreeable discount, I assure you. The MSCI EAFE, a collection of developed nations’ stocks, is available for a mere fifteen times earnings. A price that suggests, perhaps, a lack of faith in the inevitable triumph of… well, of everything. And the dividends! A respectable 3.4%, while our own S&P 500 clings to a paltry 1.5%. It’s enough to make one suspect a conspiracy of accountants.

For a decade, international equities languished, trailing behind the American juggernaut. They were the forgotten cousins at the feast, picking at the scraps. But last year, a tremor ran through the established order. Non-U.S. stocks outperformed by ten percentage points – a minor rebellion, if you will. And still, they remain undervalued. It’s as if the market, in its infinite wisdom, refuses to acknowledge a good thing when it sees it. Or perhaps it’s simply waiting for a more suitable moment to exploit the situation.

The Schwab International Equity ETF: A Modest Proposal

One need not become a connoisseur of foreign companies, poring over balance sheets in dimly lit libraries. There exists a solution, a rather…efficient solution. The Schwab International Equity ETF (SCHF 1.04%). It gathers together mid- and large-cap stocks from the developed world, excluding, naturally, our own shores. Japan, the United Kingdom, Canada, France – a respectable company, though one suspects a certain lack of imagination in their selection.

Approximately 1,500 stocks reside within this fund, a multitude, yet no single one dominates. The largest holding accounts for a mere 1.64% of the assets – a refreshing display of humility. Familiar names abound: ASML Holding, Samsung, AstraZeneca, Nestle… companies that manufacture, or at least distribute, the very necessities of modern life. Though what constitutes a ‘necessity’ is, of course, a matter of philosophical debate.

The expense ratio, a mere 0.03% – a pittance! For every $10,000 invested, you surrender a mere $3. A sum barely sufficient to bribe a moderately corrupt official. The dividend yield exceeds 3.2%, a solid income stream for those of a practical bent. And the potential for long-term returns? Considerably brighter, given the current valuations. Though, naturally, one should not expect miracles. The market, after all, is a fickle mistress.

Risks, you ask? Of course, there are risks. Currency fluctuations, geopolitical tensions… the usual assortment of calamities. And let us not forget the distinct lack of exposure to the latest technological fads. International funds, alas, are not overflowing with artificial intelligence companies. But if one seeks a reasonable value in an inflated market, the risk-reward dynamics of this ETF are, shall we say,… intriguing. It is, after all, a peculiar bargain. And in this world, one must take what one can get.

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2026-03-14 15:13