VYMI: Why This International ETF Might Keep Beating American Stocks

Core Viewpoint - The narrative of "American exceptionalism" in the stock market has shifted, with non-U.S. stocks outperforming U.S. stocks over the past year [2]. Group 1: Performance of International Stocks - The Vanguard Total International Stock ETF (VXUS) has increased by approximately 25% in the past year, surpassing the S&P 500 index [2]. - The Vanguard International High Dividend Yield ETF (VYMI) has delivered total returns of 45.5% in the past year and average annual returns of 11.8% over the past 10 years [3]. Group 2: Characteristics of VYMI - VYMI is diversified, holding 1,535 international stocks, with 43.6% from Europe, 26.4% from the Pacific, and 21.1% from emerging markets [5]. - The fund focuses on international companies expected to provide higher-than-average dividends, with a dividend yield of 3.3%, compared to the S&P 500's 1.1% [6]. Group 3: Market Trends and Outlook - Concerns about AI stocks have led investors to seek opportunities in international markets, with forecasts suggesting non-U.S. stocks will outperform U.S. stocks over the next decade [7]. - VYMI aligns with the trend towards international and value stocks, featuring holdings that include pharmaceutical companies, banks, and major brands like Toyota and Nestlé [8].