Smart Investors Are Adding VXUS as International Stocks Surge Past U.S. Benchmarks

Core Viewpoint - International stocks have recently outperformed U.S. markets, with Vanguard Total International Stock ETF (VXUS) returning 32% over the past year compared to Vanguard Total Stock Market ETF (VTI) at 22% [2][6]. Group 1: Performance Comparison - VXUS tracks the FTSE Global All Cap ex US Index, encompassing a wide range of investable stocks outside the U.S., including developed and emerging markets [3]. - The fund has a 2.86% dividend yield and a low expense ratio of 0.05%, which enhances long-term returns [4]. - Year-to-date through March 10, 2026, VXUS is up 5.92%, while VTI is essentially flat at 0.04% [4][6]. Group 2: Long-term Trends - Despite recent outperformance, long-term data indicates that U.S. stocks have significantly outpaced international stocks over five and ten-year periods [5][6]. - The structural advantages of U.S. companies in earnings growth and capital returns have contributed to this long-term underperformance of VXUS relative to VTI [5].