VXUS offers U.S. investors a leveraged play on dollar weakness and global diversification at a discount

U.S. investors in VXUS stand to benefit from valuation upside, earnings growth, and currency tailwinds not available in U.S.-only equity portfolios. The Vanguard Total International Stock Index Fund ETF (VXUS) tracks a benchmark index of stocks from developed and emerging markets outside the United States. It trades at a significant valuation discount compared to the S&P 500. Excluding the U.S., international earnings growth is converging, with double-digit EPS growth expected in 2026. A weakening U.S. dollar enhances returns for U.S.-based investors in VXUS due to the fund's lack of FX hedging. VXUS provides exposure to over 8,000 non-U.S. stocks, including significant positions in emerging markets and small-cap companies. VXUS has a low expense ratio and strong liquidity, making it a cost-effective vehicle for broad international equity exposure.