andresr/E+ via Getty Images I issued a sell call on the Vanguard International Dividend Appreciation Index Fund ETF ( VIGI ) in June last year, at a time when the US growth markets looked decidedly a better place to be. The call has aged well, with VIGI showing a total return of negative 1%, while the S&P 500 has returned close to 10% (including recent corrections). The ~11% relative underperforma...
andresr/E+ via Getty Images I issued a sell call on the Vanguard International Dividend Appreciation Index Fund ETF ( VIGI ) in June last year, at a time when the US growth markets looked decidedly a better place to be. The call has aged well, with VIGI showing a total return of negative 1%, while the S&P 500 has returned close to 10% (including recent corrections). The ~11% relative underperformance reinforces the core premise of my earlier thesis - VIGI was structurally disadvantaged versus US equities and unlikely to deliver competitive returns. However, the sell call seems too harsh given the absolute performance has not been disastrous. In current conditions, I feel this Sell rating underweights the role of VIGI as a portfolio stabilizer rather than a return engine. In this thesis, I re-evaluate VIGI for the road ahead and argue it is better rated as a Hold than the more aggressive Sell I had in June last year. Reviewing The Old Thesis The earlier thesis had found that long-term returns were not competitive (looking at historical data) across both US growth and value benchmarks. That weakness remains, but does not support a sell if portfolio stabilization is the anchor (not returns). The dividend yield also does not qualify VIGI as a strong income fund. Both these factors still imply VIGI is not yet buy material, but definitely do not rule out a hold. Data by YCharts Other factors such as correlation and drawdown protection do not show up strongly either. But they need an update. In terms of correlation, VIGI did show the desired resilience in the mid-2025 US drawdown, and overall correlations have been lower since (less than 0.8 and over a sustained period of time, down from ~0.9 before the April 2025 sell-off). Data by YCharts I was also wary of the geographical tilt in slower growth economies, especially Japan (deflation, weak wage growth), Switzerland (currency drag), and Canada (low growth momentum). While a lot of that concern remains, the Japan thesis ne...
(RTTNews) - European stocks traded lower on Friday amid fears that a prolonged conflict in the Middle East may fuel inflation and dent economic growth.
(RTTNews) - European stocks traded lower on Friday amid fears that a prolonged conflict in the Middle East may fuel inflation and dent economic growth.
Fabiana Fedeli, CIO of multi-asset at M&G Investments, says investors need to look beyond the Iran war and focus on long-term fundamentals. "It is very difficult right now taking a position on the market only based on oil prices," Fedeli tells Bloomberg Television. "You need to go one step beyond that." (Source: Bloomberg)
Fabiana Fedeli, CIO of multi-asset at M&G Investments, says investors need to look beyond the Iran war and focus on long-term fundamentals. "It is very difficult right now taking a position on the market only based on oil prices," Fedeli tells Bloomberg Television. "You need to go one step beyond that." (Source: Bloomberg)