VYMI vs. VIGI: Which International Dividend ETF Is Better?

Yahoo Finance ·

Is America still the best place in the world for Americans to invest? Recent research from Vanguard suggests that international stocks might offer stronger opportunities in the next few years. The company's 2026 economic and market outlook said that "ex-U.S. equities" -- international stocks not including the U.S. -- are expected to deliver 4.9% to 6.9% average annual returns for the next 10 years, while U.S. stocks are expected to deliver only 4% to 5% returns. Another Vanguard report in June predicted that some of the best long-term gains from the artificial intelligence (AI) boom might go not to AI stocks, but to "developed markets outside the U.S." as global companies use AI to improve their operations. Although Vanguard's research doesn't recommend any specific stocks or exchange-traded funds (ETFs), if you agree with this forecast, buying international dividend stocks could be a good strategy. That's because international stocks that pay high dividend yields tend to come from developed markets such as Japan, Canada, and Western Europe. The Vanguard International High Dividend Yield ETF ( VYMI 0.40% ) and the Vanguard International Dividend Appreciation ETF ( VIGI 1.06% ) are two Vanguard ETFs that offer exposure to international dividend stocks. Both hold portfolios that include the types of stocks that Vanguard research says might outperform in the next few years.

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