$1,000 in VEA Could Turn Into $57,000
Key Takeaways
International stocks can be a great addition to any long-term portfolio because they can vide geographical diversification and tect against risks specific to the U. And there are some excellent exchange-traded...
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July 8, 2025
06:11 AM
The Motley Fool
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International stocks can be a great addition to any long-term portfolio because they can vide geographical diversification and tect against risks specific to the U
And there are some excellent exchange-traded funds (ETFs) that can help you get exposure
One in particular that could be worth a look is the Vanguard FTSE Developed ETF (VEA -1. 24%), which is a broad index fund that focuses on developed countries Japan, Canada, and the U
Here's a rundown of what you need to know this ETF and what it could potentially do for your portfolio
Image source: Getty Images
The Vanguard FTSE Developed ETF is an exchange-traded fund that invests in companies located in developed countries, mostly in the Europe and Asia-Pacific regions
The five countries with the most representation in the portfolio include Japan, the U. , Canada, France, and Germany
The Vanguard FTSE Developed ETF has 3,800 stocks in its portfolio and is a weighted index, so larger companies account for more of the weight
However, no company makes up more than 1. 3% of this ETF's assets
It would be a mistake to assume that because this is an international stock ETF, it's full of companies you've never heard of
In fact, the fund's 10 largest holdings include Nestle, semiconductor equipment giant ASML Holding, Novartis, Toyota, and Novo Nordisk, to name just a few
There are a lot of companies in the ETF's index that are household names to most Americans -- they're just based elsewhere
Most Vanguard ETFs, the Vanguard FTSE Developed ETF is a very inexpensive way to invest
It recently reduced its already-low expense ratio to just 0. 03%, which means you'll pay just $3 in annual investment fees for every $10,000 in assets
Performance history Speaking of performance, here's a look at how the Vanguard FTSE Developed ETF has done over certain time periods
Time Period Total Return (Annualized) 1 year 18. 9% 3 years 15. 3% 5 years 11. 4% 10 years 6. 8% Data source: Vanguard
Returns as of 6/30/25
Not only have international stocks had strong momentum recently, as you can see from the chart, but the Vanguard FTSE Developed ETF looks rather inexpensive right now
The average stock owned by the ETF trades for 16 times earnings, compared to a price-to-earnings ratio (P/E) of 26 for the typical S&P 500 component
Could the Vanguard FTSE Developed ETF help you build wealth
Any ETF's past performance doesn't guarantee future results
With that in mind, total returns of 8%-10% annually aren't unreasonable to expect over the long run
Using the midpoint of this range (9%), this means that a $1,000 investment could grow to $5,600 over a 20-year period
However, the best way to use index funds this one is to invest regularly over time
Using our 9% total return example, a $1,000 investment made every year for 20 years (so $20,000 total) could grow to nearly $57,000
These numbers are simply to illustrate the long-term potential of the Vanguard FTSE Developed ETF
But the bottom line is that this ETF can be a great way to get exposure to rock-solid international companies at a bare minimum of expense
Matt Frankel has no position in any of the stocks mentioned
The Motley Fool has positions in and recommends ASML and Vanguard Tax-Managed Funds-Vanguard Ftse Developed ETF
The Motley Fool recommends Nestlé and Novo Nordisk
The Motley Fool has a disclosure policy.
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