Vanguard and Goldman Sachs Forecast Stronger Returns for International Stocks
Vanguard and Goldman Sachs forecasts pointed to stronger long-term returns for international stocks than for U.S. equities. The articles highlighted broad international, European and emerging-market ETFs with low expense ratios and large exposure to non-U.S. markets.
International stocks are projected to outperform U.S. equities over the next decade, according to forecasts cited in two investment articles. Vanguard predicts U.S. equity growth at 4%-5% over the next 10 years, but anticipates non-U.S. equities can go to 7% in the same decade, while Goldman Sachs projects European stocks to return 7.5% annually and emerging-market stocks to return 12.8% annually.
For investors seeking international exposure, the articles highlighted several low-cost exchange-traded funds. Vanguard Total International Stock Index Fund ETF Shares (VXUS) uses the FTSE Global All Cap ex-USA Index as its benchmark and holds 8,560 stocks drawn from Europe, Pacific Rim and emerging markets. It had $636.67 billion in net assets, a 0.05% expense ratio, a 2.86% yield, and a 39.91% one-year return.
VXUS top holdings included Taiwan Semiconductor (3.43%), Samsung Electronics (1.59%), ASML Holding NV (1.29%), Tencent Holdings (0.92%), SK hynix Inc (0.91%), Roche Holding AG (0.76%), Alibaba Group (0.73%), Novartis AG (0.73%), HSBC Holdings plc (0.73%), and AstraZeneca plc (0.71%).
Vanguard International High Dividend Yield Index Fund ETF Shares (VYMI) focuses on high dividend international stocks and held $20.1 billion in net assets. At the time described, it was yielding 3.28%, averaged 1.58 million shares in daily volume, had a 0.07% expense ratio, a 14.05 P/E ratio, a 45.49% one-year return, and a 0.90 beta. Its holdings came primarily from Japan (about 14%), the UK (nearly 11%), Canada (about 8%), Switzerland (close to 7%), and Australia (also about 7%), with a 40% weighting toward financials.
VYMI top holdings included Roche Holding AG (1.78%), Novartis AG (1.72%), HSBC Holdings plc (1.7%), Nestle SA (1.48%), Toyota Motor (1.37%), Shell plc (1.29%), Royal Bank of Canada (1.26%), Commonwealth Bank of Australia (1.11%), Mitsubishi UFJ Financial Group (1.09%), and BHP Group (1.06%).
The articles also pointed to region-specific funds. The Vanguard FTSE Europe ETF tracks about 1,200 companies across Europe, especially the United Kingdom, Switzerland, France, and Germany, and is most heavily weighted toward financials (24%), industrials (19%), and healthcare (13%). Its top holdings were ASML Holding (3.5%), Roche Holding (2%), HSBC Holdings (1.9%), Novartis (1.8%), and AstraZeneca (1.7%). The fund has an expense ratio of 0.06%.
Goldman Sachs said European stocks were supported by strong earnings growth, a relatively high dividend yield of about 3%, and stock buybacks. The forecast also said the U.S. dollar was expected to lose value relative to the euro, contributing to outperformance for U.S.-based investors.
The Vanguard FTSE Emerging Markets ETF measures the performance of about 6,200 companies in emerging markets, especially China, Taiwan, and India. The fund is most heavily weighted toward technology (29%), financials (21%), and consumer discretionary (12%). Its top holdings were Taiwan Semiconductor (11.6%), Tencent Holdings (4.3%), Alibaba Group (3.3%), HDFC Bank (1%), and Reliance Industries (0.9%), and it has an expense ratio of 0.06%.
Goldman Sachs said emerging-market stocks were supported by particularly strong earnings growth in China and India. One of the articles also said Bank of America declared 2026 a “New World Order” for international stocks, and that inflows to international ETFs soared to over $220 billion in 2025 and zoomed to $250 billion by mid-February 2026.