iShares MSCI ACWI ex US ETF

ACWX

Market cap $6.92B

Company payouts are stronger compared to previous years, despite brewing macro risks. A weaker dollar and resilient consumer spending support record earnings and stock prices, even amid cautious CEO sentiment. We spot key events as the calendar flips to October, along with happenings at the biggest U.S. bank.

iShares MSCI ACWI ex U.S. ETF is rated a buy as a stable, diversified core holding for global equity exposure outside the US. Invesco S&P International Developed Momentum ETF is also rated a buy but is best used as a tactical complement due to high turnover and sector concentration. IDMO offers superior risk-adjusted returns in bull markets but carries uncertainty from its momentum strategy and 115% annual portfolio turnover.

Now in the home stretch of Q3, international stocks have had a banner year in 2025. Whereas the United States' S&P 500 is currently up 12.7% year to date, the MSCI All World Ex. US ETFs have gained well over 24% in that same span. Italy (EWI) is up over 45% on a year to date basis. That puts it on pace for the ETF's largest annual gain on record (it began trading in March 1996) if it holds.

U.S. stocks continued their momentum with a solid +2.30% return, while world stocks pulled back -1.12% after their strong June performance. The commodity surge pushed this asset class to +4.73% year-to-date, representing a remarkable turnaround from the challenging April decline.

Investors keep piling into exchange-traded funds — with the latest monthly flow data reflecting some limit to their appetite for risk in the U.S., as well as a desire to diversify internationally.

Global financial markets remain in focus this week after the US launched airstrikes on three Iranian nuclear facilities over the weekend, to which Tehran retaliated with an attack on the US bases in Qatar.

ACWX offers broad, diversified exposure to non-US equities, providing a valuable tool for geographic diversification without overlapping US holdings. The ETF boasts strong liquidity and reasonable expenses, outperforming many peers in cost and tradability, making it a practical choice for international allocation. Shifting macroeconomic trends, including US policy uncertainty and improving international growth, support increasing non-US equity exposure for better risk-adjusted returns.

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iShares MSCI ACWI ex U.S. ETF offers diversification with 1,800 international stocks but has lower exposure to high-growth tech sectors, potentially limiting long-term returns. Easing global monetary policies and receding inflation should benefit ACWX in the near term, with earnings growth expected to improve through 2026. ACWX is trading at a fair valuation of 13.2x forward P/E, compared to the higher valuation of the S&P 500 at 22.0x.

iShares MSCI ACWI ex U.S. ETF offers broad international exposure excluding the US, making it attractive for long-term investors seeking diversification. The ACWX ETF has highly diversified holdings with no position making up more than 2.88% of the fund, providing a balanced mix of international equities. The fund compares well against peers like Vanguard Total International Stock Index Fund ETF Shares and offers exposure to developed and emerging markets at a relatively low cost.