The Vanguard MSCI Index International Shares ETF (ASX: VGS) is one of the most popular exchange-traded funds (ETFs) on the ASX. In fact, at the latest count, VGS currently occupies the second spot in terms of assets under management. With more than $15 billion under its belt, this index fund is only behind its ASX-focused cousin, the Vanguard Australian Shares Index ETF (ASX: VAS).
As such, there are more than a few ASX investors who have a vested interest in this ETF. So let’s dive into how VGS went over the month that has just passed us by.
The Vanguard International Shares ETF is, as its name implies, an internationally-focused fund. On paper, it holds more than 3,500 individual underlying holdings, spread across more than 20 advanced economies of the world. These range from Japan, the United Kingdom and Switzerland to Spain, Singapore and Israel.
In practice, though, VGS is a US-focused index fund, with a sprinkling of international diversity on top. More than 72% of this ASX ETF’s portfolio is made up of US stocks. These US stocks are top-heavy, and tech-heavy, within the ETF itself, too. To illustrate, Nvidia and Apple together making up more than 10% of the fund’s weighted portfolio. Throw in Microsoft and Amazon, and we almost get to 16%.
But we digress.
How did the Vanguard MSCI Index International Shares ETF perform last month?
The Vanguard International Shares ETF had a relatively pleasant month in April. This ASX ETF started the month at $141.15 a unit. Yesterday, those units finished the month’s trading at a price of $148.63. That’s an April gain worth 5.3% â much better than VAS’ 1.46% return, representing the Australian share market, over the same period. Of course, this gain came after VGS lost 4.38% on the ASX over March. But even so, ASX investors will be happy to see that kind of number.
This index fund has been a solid performer for ASX investors in recent years as well. As of 31 March, VAS units have returned a total of 16.08% per annum over the preceding three years. That includes unit price growth as well as dividend distributions. Over five years, VGS has averaged 12.76% per annum, and 13.26% per annum over ten. Its heavy exposure to America’s big tech stocks is undoubtedly responsible for much of that performance. Let’s see how it goes over May.
The Vanguard MSCI Index International Shares ETF charges a management fee of 0.18% per annum.
The post Inside the Vanguard MSCI Index International Shares ETF (VGS)’s big April gain appeared first on The Motley Fool Australia.
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Motley Fool contributor Sebastian Bowen has positions in Apple, Microsoft, and Vanguard Australian Shares Index ETF. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Apple, Microsoft, and Nvidia. The Motley Fool Australia has recommended Apple, Microsoft, Nvidia, and Vanguard Msci Index International Shares ETF. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.