Avantis International Small Cap Value ETF

AVDV

Market cap $15.9B

Active and passive investing strategies are pit against each other all the time despite appearing together in countless portfolios.

2025 has had plenty of ups and downs, but one narrative that has been plain to see has been the strength of international equities. The international ETF space has been one to watch with strong performances and robust returns for investors.

2025 has been a strong year for foreign equities. Even before the year began, many market watchers were looking to move from an underweight to neutral or even overweight position.

AVDV focuses on active small-cap value investing in developed markets, emphasizing book-to-price ratios and profitability. Its consistent overweight in Japan has driven recent outperformance versus peers and US indices. The portfolio is diversified across 1,600 stocks, with low concentration risk and conservative turnover for an active fund.

Avantis International Small Cap Value ETF targets small-cap value stocks in developed markets outside the U.S., offering diversification beyond expensive U.S. indices. AVDV maintains a competitive net expense ratio of 0.36% and a low turnover rate of 8%, appealing to cost-conscious investors. The ETF trades at a P/E of around 17x, more attractive than many alternatives in today's market, though not historically cheap.

The recent pullback for big techs in the U.S. underscores the need for investors to focus more on international stocks and bonds.

The Schwab US Dividend Equity ETF (NYSEARCA:SCHD ) was often seen as the gold standard among dividend exchange-traded funds.

Small cap stocks have had a complicated 2025. In certain segments, they have performed well, but writ large, they've struggled.

If you're one of those investors who like to take the path of least resistance and invest in only the S&P 500, you could be losing an opportunity to make money.

International equities have played a big role for investor portfolios this year. From the start of 2025, many market watchers may have wanted to move out of an underweight position in ex-U.S. equities, specifically.