International Stocks Are Winning Again and This $8.7 Billion ETF Proves It

Core Insights - The performance gap between US-heavy portfolios and international investments is narrowing, prompting investors to reconsider the necessity of international exposure [2] - The iShares MSCI ACWI ex U.S. ETF (ACWX) offers a low-cost way to track major equity markets outside the US, with a focus on both developed and emerging markets [3][4] Fund Structure and Holdings - ACWX tracks the MSCI ACWI ex USA Index with a 0.32% expense ratio and 5% annual portfolio turnover, indicating a passive investment strategy [3] - Major holdings include Tencent, ASML, Samsung, AstraZeneca, and Roche, with no single position exceeding 1.51%, minimizing concentration risk [3] Performance Analysis - Over the past year, ACWX has returned 35.8%, significantly outperforming the S&P 500's 13.0% gain, driven by a weakening dollar and recovering European equities [5] - Year-to-date in 2026, ACWX is up 10.4%, while the US market has remained flat, suggesting a potential shift in global equity leadership [6] Long-term Perspective - Over five years, ACWX returned 50.8% compared to 76.8% for the S&P 500, reflecting the sustained US growth cycle of the early 2020s [7] - ACWX tracks nearly identically to the Vanguard FTSE All-World ex-US ETF (VEU) across all timeframes, with VEU slightly ahead due to minor index methodology differences [7] Currency Exposure - Currency exposure is a significant factor, as ACWX holds assets priced in various currencies, meaning a strengthening US dollar can erode returns for American investors [8]