Vanguard Europe Pacific ETFVEA

ETF Research and Analysis

by Bradley Kay
Suitability

Vanguard Europe Pacific ETF VEA provides the cheapest broad investment in stable developed-market foreign stocks. This fund may not strictly replicate the MSCI EAFE Index, but it samples all of its holdings from that benchmark and strives for close tracking with minimal cost or tax consequences.  Read more 

Bull Case

The cheapest foreign large-blend ETF, and a great way to invest in the core asset class of foreign equities.
The developed-market multinationals that dominate the MSCI EAFE Index match the stability and quality of companies in the S&P 500, which has helped this index exhibit very low volatility.
A global presence may help these companies survive a depression in better shape than their local small-cap counterparts because of greater geographic diversification and some emerging-markets presence. Read more 

Bear Case

The multinationals that dominate the developed-markets large-cap universe do not provide much diversification benefit as they often produce and sell their goods in the same markets as U.S. large-cap companies.
This index excludes Canadian stocks, which are about 5% of the global developed-markets capitalization outside the U.S. Read more 

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