Vanguard International Shares ETF Falls 11% In Dec’ Quarter, But Things Looks Up

The December 2018 quarter was a painful one for the Vanguard MSCI Index International Shares ETF (ASX: VGS), it fell 11%.

The Vanguard MSCI Index International Shares ETF is an exchange traded fund (ETF), VGS aims to track the return of the MSCI World ex-Australia Index in Australian dollar terms. This translates to low cost, diversified exposure to many international shares outside of Australia. It is offered by Vanguard, one of the world-leading providers of low cost investing.

Why The Vanguard MSCI Index International Shares ETF fell 11% in 3 months

The December 2018 quarter saw some of the ETF’s biggest holdings like Apple, Microsoft, Alphabet and Amazon fall in value. A combination of the ongoing trade war, President Trump and a US Federal Reserve rate hike caused the share market to be volatile.

Despite the drop of the unit price, the ETF’s main attractions still apply for investors. It has a low annual management fee of 0.18%, many of its largest holdings are global leaders of their industries and the underlying return on equity (ROE) of the index is 14%.

In-fact, the ETF’s holdings are so diverse that five sectors have more than 10% allocated:

  • Financials
  • Information Technology
  • Health Care
  • Industrials
  • Consumer Discretionary

According to Vanguard, this ETF was valued at 31 December 2018 with a price/earnings ratio of 15x and an earnings growth rate of 7.9%.

Is now a good time to buy The Vanguard MSCI Index International Shares ETF?

Famous investor Warren Buffett has an excellent analogy when thinking about shares:

“I’m going to buy hamburgers the rest of my life. When hamburgers go down in price, we sing the ‘Hallelujah Chorus’ in the Buffett household. When hamburgers go up in price, we weep. For most people, it’s the same with everything in life they will be buying — except stocks. When stocks go down and you can get more for your money, people don’t like them anymore.”

You’d need a time machine to know if the December 2018 quarter was the worst of the share market falls.

But, an effective strategy could be to invest a regular amount every month to take advantage of falls and gains over time.

From 200+ ETFs in Australia, our top investment analyst has just identified his #1 ETF for 2021 and beyond.

Low fees? Check.

Long-term growth potential? Check.

Regular cash returns? Check!

This ETF makes investing in ETFs "Super-Easy".

Simply click here or enter your email address below to access the full ETF report, ticker code, and step-by-step investment guide. Our expert's #1 ETF report is completely free.

No gimmicks, no payment, no credit card info. Just enter your email address below and we'll send you the report right away.

From 200+ ETFs in Australia, our top investment analyst has just identified his #1 ETF for 2021 and beyond.

Low fees? Check.

Long-term growth potential? Check.

Regular cash returns? Check!

This ETF makes investing in ETFs "Super-Easy".

Simply click here to access the full ETF report, ticker code, and step-by-step investment guide. Our expert's #1 ETF report is completely free.

No gimmicks, no payment, no credit card info. Just click the link below and enter your email address. We'll send you the report right away.

CLICK HERE TO GET THE REPORT

Unsubscribe anytime. Read our TermsFinancial Services GuidePrivacy Policy. We’ll never sell your email address. Our company is Australian owned.

Information warning: The information on this website is published by The Rask Group Pty Ltd (ABN: 36 622 810 995) is limited to factual information or (at most) general financial advice only. That means, the information and advice does not take into account your objectives, financial situation or needs. It is not specific to you, your needs, goals or objectives. Because of that, you should consider if the advice is appropriate to you and your needs, before acting on the information. If you don’t know what your needs are, you should consult a trusted and licensed financial adviser who can provide you with personal financial product advice. In addition, you should obtain and read the product disclosure statement (PDS) before making a decision to acquire a financial product. Please read our Terms and Conditions and Financial Services Guide before using this website. The Rask Group Pty Ltd is a Corporate Authorised Representative (#1280930) of AFSL #383169.

Keep reading:

General Financial Advice warning
The information on this website is general financial advice only. That means, the advice does not take into account your objectives, financial situation or needs. Because of that, you should consider if the advice is appropriate to you and your needs, before acting on the information. In addition, you should obtain and read the product disclosure statement (PDS) before making a decision to acquire a financial product. If you don’t know what your needs are, you should consult a trusted and licensed financial adviser who can provide you with personal financial product advice. Please read our Terms & Conditions and Financial Services Guide before using this website.

© Rask Australia 2020

Join 20,000+ smart investors

Join the Rask Australia mailing and we’ll send you free investment reports, podcasts, expert insights, investing courses, ASX news and lots, lots more. All free. 

Unsubscribe anytime. Read our TermsFinancial Services GuidePrivacy Policy. We’ll never sell your email address. Our company is Australian-owned.

feedback-icon

What can we do better? Please give us us some feedback :)

We care about your experience, please let us know if you have any suggestions to improve our site.