Is SCHF the Right International ETF for a Diversified Portfolio?

Core Viewpoint - International stocks are experiencing a significant resurgence in 2025, with the MSCI EAFE Index expected to outperform the S&P 500 for only the second time since 2019, and by a considerable margin [1]. Group 1: Investment Opportunities - The Schwab International Equity ETF (SCHF) has outperformed the MSCI EAFE Index by nearly 300 basis points over the past three years, making it an attractive option for investors [4]. - The ETF primarily focuses on developed market stocks, distinguishing it from other international funds that may include emerging markets [4]. - The ETF provides exposure to nearly 1,500 stocks, with no single stock exceeding 1.6% of the portfolio, and technology stocks making up only 10.17% of the lineup, offering significant diversification compared to U.S. stock indices [6]. Group 2: Diversification Benefits - The ETF addresses the home country bias prevalent among American investors, as 40% of investable markets are located outside the U.S., presenting growth opportunities that could mitigate portfolio risk [5]. - Investing in international markets can reduce dependence on the U.S. economic cycle, potentially shielding investors from domestic recessions [7]. - The ETF is accessible with a low fee of 0.03% per year, making it suitable for long-term investors seeking diversification [10]. Group 3: Market Context - Despite the recent rally in international stocks, considerable value remains in these equities, contrasting with the higher valuations of domestic stocks [9]. - The current price of the Schwab ETF is $24.09, with a 52-week range of $17.56 to $24.41, indicating a stable investment option [9].