Core Viewpoint - The discussion centers around the performance of foreign equities in 2026, with contrasting views on whether they can replicate the strong returns seen in 2025. One analyst expresses skepticism about the sustainability of last year's gains, while the other remains optimistic about continued favorable conditions for international strategies [1][7]. Performance Metrics - The S&P World ex-U.S. Index achieved a 34.5% return as of January 9, 2026. Notable ETFs included the KraneShares Emerging Markets Consumer Technology Index ETF (KEMQ) with a 56.2% return, the Avantis International Small Cap Value ETF (AVDV) at 49.4%, and the VanEck Africa Index (AFK) with a remarkable 74.7% return in 2025 [3][4]. Market Conditions - The uncertainty surrounding the U.S. economy continues to drive investor interest in foreign equities. The U.S. job market showed weak performance, adding only 50,000 jobs in December 2025, which was below expectations and marked the lowest job growth in five years [9][10]. - Geopolitical risks are highlighted as a significant concern for foreign equities in 2026, with potential conflicts in regions like Venezuela and Ukraine posing threats to market stability [23][25][26]. Investment Opportunities - Diversification through international markets is emphasized, with both developed and emerging markets presenting strong opportunities. Investing in a mix of these markets can enhance portfolio diversification [11][19]. - The American Century Quality Diversified International ETF (QINT) is noted for its strategy of investing in large- and mid-cap stocks outside the U.S. with strong fundamentals, achieving a 38.02% return year-to-date as of December 31, 2025 [22][21]. Sector Analysis - The discussion includes a focus on sectors such as precious metals and technology, with a cautionary note on the sustainability of returns from mining-focused ETFs. The potential for growth in AI and defense sectors is also mentioned, driven by increased spending commitments from NATO members [12][18][17]. Regional Insights - Analysts express concerns about Europe's growth potential, citing slower earnings growth and structural challenges. The outlook for Asia, particularly India, is also cautious, with projections indicating a slowdown compared to 2025 [14][15]. - China's market is highlighted for its resilience and potential growth opportunities, particularly in the tech sector, with expectations for a new five-year plan to stimulate the economy [32][33].

International equities were a very strong segment for investors last year. Foreign firms in Europe, Asia, South America and Africa helped lift portfolios for investors. Repeating that strong performance this year may be tough, but investors have options. By leaning into small-cap offerings within international equities strategies, investors and advisors can get exposure to firms with potentially greater upside and growth potential. See more: Last Minute ETF Shopping? Don't Miss These Tax & Income ETFs Consi ...

Core Insights - Avantis Investors combines active and passive investing strategies to enhance portfolio performance, particularly through its "Systematic Active" approach in equities and fixed income ETFs [1] - The firm has surpassed $100 billion in total fund assets under management (AUM) since its inception in 2019, focusing on cost-conscious investment strategies while leveraging active management for customized asset allocations [2] Performance Highlights - The Avantis International Small Cap Value ETF (AVDV) has achieved a year-to-date return of 49.2%, significantly outperforming its category average across various time frames [4] - AVDV charges a fee of 36 basis points and aims to combine the benefits of indexing, such as transparency and diversification, with active management's value-driven decision-making [3] Investment Strategy - AVDV's strong performance is attributed to its focus on mining and metals firms, with no single sector exceeding 17% of the portfolio as of December 23rd [5] - The ETF is positioned as a strong long-term hold for investors seeking exposure to foreign equities, effectively integrating both active and passive investment strategies [5]

Core Insights - The international ETF space has shown strong performance in 2025, with a focus on the Avantis International Small Cap Value ETF (AVDV) as a notable investment option [1][2] - AVDV has achieved a year-to-date return of 47%, significantly outperforming its ETF Database Category average of 33.1% [1][2] - The fund's strategy combines active fundamental research with passive investment benefits, emphasizing flexibility and low costs [1][3] Performance Metrics - AVDV has consistently outperformed its category average over various time frames, including three- and five-year periods [2] - The fund's performance has been bolstered by its focus on small-cap value companies, which may thrive amid geopolitical and economic uncertainties [4] Investment Strategy - The management of AVDV employs fundamental criteria to identify highly profitable value firms, focusing on metrics such as shares outstanding, cash flow, revenue, expenses, and price-to-book value [3] - The appeal of international equities lies in their potential for diversification away from domestic U.S. uncertainties, making AVDV a compelling option for investors as the new year approaches [5]

2025 has been a strong year for foreign equities. Even before the year began, many market watchers were looking to move from an underweight to neutral or even overweight position. Several factors since then have boosted the case for international, and international equity ETF strategies have benefitted. One such strategy from Avantis Investors currently sits among the top five YTD international performers and merits a closer look. RELATED TOPICS Avantis InvestorsAVDVcore strategies Content Hubinternational ...

Core Viewpoint - GMO warns that the AI sector resembles a classic investment bubble characterized by high valuations and rampant speculation [1][2] Group 1: AI Bubble Concerns - GMO has consistently cautioned about an AI bubble, reiterating its bearish stance as market exuberance grows [1] - Quantum computing stocks have surged over 1200% in the past year, leading to valuations that appear excessive [2] - The current market environment is compared to the dot-com bubble of 2000, suggesting potential risks for investors [3] Group 2: Investment Opportunities - GMO identifies attractive investment opportunities in developed market value stocks and non-US small-cap value stocks, especially in Japan [4] - Investors can shift their portfolios away from the AI sector without sacrificing long-term expected returns, as other risk assets are trading at fair valuations [6] - Funds such as the Avantis International Small Cap Value ETF (AVDV) and the iShares MSCI Intl Value Factor ETF (IVLU) provide exposure to these alternative investments [6]

Core Insights - The article focuses on the Avantis International Small Cap Value ETF (AVDV), highlighting its performance and strategy in the small-cap value segment within developed markets [1]. Group 1: ETF Performance - AVDV has experienced decent traction in 2025, indicating a positive reception in the market [1]. Group 2: Analyst Background - The analysis is conducted by a stock analyst with over 20 years of experience in quantitative research, financial modeling, and risk management, emphasizing expertise in equity valuation and market trends [1]. - The analyst has a background as a former Vice President at Barclays, leading teams in model validation and stress testing, which adds credibility to the analysis [1]. Group 3: Research Approach - The research approach combines rigorous risk management with a long-term perspective on value creation, focusing on macroeconomic trends, corporate earnings, and financial statement analysis [1]. - The collaboration with a research partner enhances the quality of insights provided, leveraging complementary strengths [1].

Core Insights - The article focuses on the Avantis International Small Cap Value ETF (AVDV), which is an active small cap value ETF targeting developed markets. It has gained traction in 2025, indicating positive investor interest and performance [1]. Group 1: ETF Overview - AVDV is designed to invest in small-cap value stocks within developed markets, aiming to capitalize on potential growth opportunities in this segment [1]. Group 2: Investment Strategy - The ETF employs an active management strategy, which differentiates it from passive ETFs, allowing for more responsive investment decisions based on market conditions [1]. Group 3: Market Performance - The article notes that AVDV has seen decent traction in 2025, suggesting that it has performed well relative to its peers or the broader market during this period [1].

Group 1: Market Overview - International equities have gained significant importance in investor portfolios in 2025, with a shift from underweight positions in ex-U.S. equities driven by tariff changes and a declining dollar [1] - A notable increase in assets under management (AUM) has been observed in international equities ETFs, with one ETF adding over $500 million in AUM within a week [1] Group 2: Fund Specifics - The Avantis International Small Cap Value ETF (AVDV) focuses on small-cap and value opportunities, leveraging Avantis Investors' fundamental research [2] - AVDV has attracted $550 million in net inflows over the last five days, bringing its total AUM to approximately $13.5 billion [3] Group 3: Performance Metrics - AVDV has delivered a strong year-to-date return of 40%, outperforming its ETF Database Category average [4] - The fund's active management strategy allows it to adapt to market changes, potentially benefiting from a further weakening of the U.S. dollar and enhancing its ability to identify strong opportunities in low information environments [4]

Core Insights - The strong performance of international equities and foreign firms has been a significant trend in 2025, with many investors initially underweight in ex-U.S. stocks, but tariff concerns and attractive valuations have led to increased interest in foreign equities ETFs [1] - International small-caps are particularly appealing due to their relative affordability compared to other international equities, providing a lower cost entry point for investors [2] - The interest rate environment abroad, especially in markets like Japan, is favorable for international small-caps, as they often rely on borrowing for growth, benefiting from lower debt costs [2] Fund Performance - The Avantis International Small Cap Value ETF (AVDV) has shown robust performance, returning 39% year-to-date, outperforming its ETF Database Category and FactSet Segment averages [3] - AVDV focuses on firms with strong fundamental criteria, including cash flow, price-to-book value, revenue, and expenses, and charges a fee of 36 basis points [3] - The fund's strategy and performance make it a valuable addition to an equities portfolio, especially amid ongoing U.S. economic uncertainty [4]