“With the recovery looking more globally oriented than it had previously, ETF investors may continue to show confidence in international equity and fixed income strategies. Indeed, the prospects for higher growth and, therefore, higher returns remain attractive outside the United States, as most countries favor more accommodative monetary policies and appear to be in an earlier stage of the global expansion,” Mazza added.
Investors can also access international stocks through options like the Oppenheimer International Revenue ETF (NYSEArca: REFA) and the Oppenheimer Emerging Markets Revenue ETF (NYSEARCA: REEM), which also come with a value tilt due to their revenue-weighting index methodology.
Revenue weighting could provide diversified exposure to the market, is not influenced by stock price, reflects a truer indication of a company’s value and offers stable sector exposure. Moreover, revenue weighting may provide a more value-oriented portfolio and historically outperformed in a value-driven market while showing lower drawdowns during growth-driven markets.
REFA’s top country tilts include Japan 31.3%, U.K. 13.8%, France 13.0%, Germany 12.8% and Italy 5.2%. Top holdings include Toyota Motor 1.9%, BP 1.5%, Glencore 1.3%, Diamler AG 1.3% and Exor 1.3%.
REEM’s top country weights include China 21.8%, South Korea 21.8%, Taiwan 9.7%, India 9.5% and Brazil. Top component holdings include Samsung Electronic 2.3%, China Construction 2.2%, Lukoil 1.9%, Hon Hai Precision 1.8% and Gazprom 1.8%.