Buy the best stocks outside the U.S.

Article Excerpt

Our view hasn’t changed—virtually all Canadians should have, say, 20% to 30% of their portfolio in U.S. stocks, or in ETFs holding those stocks. In fact, for some investors, that’s all the foreign exposure their portfolios really need. U.S. stock markets have performed much better than most other equity markets over the past decade and our advice has paid off for those investors. Still, international markets can add further diversification and provide exposure to some top global leaders. These two ETFs hold a basket of leading international companies that are based outside of the U.S. and offer direct global exposure (see the supplement on page 79 for more information). VANGUARD DEVELOPED MARKETS INDEX ETF $41.72 (New York symbol VEA; TSINetwork ETF Rating: Aggressive; Market cap: $72.3 billion) tracks the FTSE Developed All Cap ex U.S. Index.  The ETF includes 23 different countries in its portfolio: Japan (20.9%), the U.K. (12.4%), France (7.8%), Switzerland (7.3%), Germany (7.1%), Australia (5.8%) and the Netherlands (4.5%). The main industry…