VFWAX and international stocks beat U.S. market

The broader international complex has strengthened across multiple funds. Vanguard FTSE Developed Markets ETF, or VEA, recently climbed to $73.76, well above its 50-day and 200-day moving averages of $71.65 and $67.42. iShares Core MSCI Total International Stock ETF, VXUS, rose to $88.41, also comfortably above its 50-day and 200-day averages. iShares MSCI ACWI ex U.S. ETF, ACWX, advanced to $78.50 and remains above both key trend lines as well. Those are not the kind of price patterns you see in a broken asset class.

Even the technical backdrop points to a healthier trend. In all three funds, RSI readings are in the middle of the range rather than signaling an overheated move, while prices sit near or above the upper end of their recent Bollinger Bands. In plain English, international stocks have momentum, but they do not look frothy.

For VFWAX investors, the economic significance is straightforward. A broad ex-U.S. fund gives you access to developed and emerging markets outside the United States, including sectors and geographies that are underrepresented in the S&P 500. That matters if you believe the next decade may reward a more balanced mix of regions, especially after years in which U.S. megacaps dominated global returns. It also matters in a world where currency moves can quietly boost or hurt returns. Adalytica.com’s trade-signal snapshot shows the U.S. dollar still carrying neutral readings, which means currency support or drag can shift quickly and is worth watching for investors in overseas assets.

The market’s message is not that investors should abandon U.S. stocks. It is that concentration risk cuts both ways. The S&P 500, tracked here by SPY, has also recovered, but Adalytica.com’s signal snapshot shows only neutral sentiment and a recent wobble in trend readings. That makes the case for international diversification stronger, not weaker. If one region pauses while another leads, a global fund can smooth the ride without forcing you to predict the winner.

For buy-and-hold investors, that is the real appeal of VFWAX. You are not trying to call a top in U.S. exceptionalism or a permanent victory for foreign markets. You are owning thousands of companies across Europe, Japan, Canada, and emerging markets and letting the global economy do the work over time. That approach can be especially valuable for investors building wealth over 5, 10, or 20 years, because the best portfolios are usually the ones that stay invested through changing leadership.

Of course, there are risks. International markets can lag for long stretches, and foreign-exchange swings can amplify volatility. Political uncertainty, slower growth, and weaker corporate profitability in some regions can also weigh on returns. But that is exactly why valuation and diversification matter. The point is not that ex-U.S. stocks will always win. The point is that they do not need to win every year to earn a place in a serious long-term portfolio.

So is Vanguard FTSE All-World ex-US Index Admiral a strong mutual fund? If your goal is to build a resilient, globally diversified portfolio, the answer is yes. With international equities firming and broad ex-U.S. funds trading above their major moving averages, VFWAX looks like a sensible core holding for patient investors who want to own the rest of the world, not just the United States. It is worth watching, and for long-term investors, worth considering.