This International ETF Could Lead Again in 2026

Core Insights - International stocks and related ETFs are expected to outperform the S&P 500 in 2025, with the WisdomTree International Equity Fund (DWM) showing a performance margin of over 2-to-1 against the S&P 500 as of November 20 [1][2] - Professional investors are optimistic about international equities for 2026, with 42% of respondents in Bank of America's Global Fund Manager Survey believing they will be the top-performing asset class [3][4] Performance Analysis - DWM has outperformed the MSCI EAFE Index by 300 basis points and has exhibited lower annualized volatility compared to developed markets [1] - The fund, which has a market size of $602.3 million, is approaching its 20th anniversary and is not considered overbought despite its strong performance in 2025 [4] Market Sentiment - The global rebalancing theme is gaining traction, with U.S. policies contributing to lower oil prices and fiscal stimulus in other regions [4] - Only 10% of professional investors surveyed believe Japan's Nikkei will be the best-performing equity index next year, which is relevant for DWM as it allocates nearly 25% of its weight to Japanese stocks [6] Overbought Markets - Countries identified as having the most overbought equity markets include South Korea, South Africa, Brazil, Spain, and Taiwan, with only Spain represented in DWM at 5.91% [5]