American Century Quality Diversified International ETF

QINT

Market cap $412M

Investors have a big appetite for international equities diversification right now, and no wonder. Foreign equities have leapt forward amid U.S. turbulence Of course, the future remains uncertain, and the same international stocks that did so well in 1H may not do the same looking ahead.

In yet another milestone for the ETF space, American Century Investments saw its suite surpass $75 billion in total AUM. The firm, which also offers ETFs under the Avantis Investors brand, offers ETFs like its largest, the Avantis U.S. Small Cap Value ETF (AVUV).

Earlier this year, when domestic and macroeconomic uncertainty kicked up, many advisors chose to broaden their equity exposure into international companies.  At the time, this made plenty of sense.

QINT offers diversified exposure to international equities, excluding US stocks, with strong representation from innovative and market-leading companies like Novartis, Hermes, and Sony. Top holdings are attractive for their innovation and market leadership, but rising P/E ratios driven by declining earnings raise valuation concerns. Despite QINT's diversification, many top holdings appear overvalued, making the ETF less attractive from a valuation perspective at current levels.

Earlier this year, VettaFi hosted its annual Exchange conference, bringing together some of the top minds in portfolio management. During the conference, Cinthia Murphy, VettaFi investment strategist, sat down with Rene Casis, vice president and head of strategy implementation at American Century Investments to discuss the firm's advantages, attractive fund strategies, and more.

Advisors and investors with a large overweight to U.S. equities felt the pain of significant drawdowns mid-April, as U.S. tariffs sent markets into a tailspin. Diversifying internationally could prove advantageous in 2025, given the muddied outlook for U.S. markets.

As investors look at their portfolios, foreign diversification is growing in prominence as a theme to watch. Domestic risks — including a higher-for-longer rate regime, the potential impact of tariffs, and stubborn inflation — loom over domestic-heavy U.S. portfolios.

With more and more ETFs arriving every day, it can be easy to get distracted by the latest shiny object. ETFs of all ages can play a role, yes, but sometimes it makes the most sense to consider those long term performance ETFs that have proven their worth over several years.

It's difficult to not have a home bias to U.S. equities the way they've been rallying as of late. However, other countries like Japan may finally be following suit, potentially bringing bullish notions back to international equities.

The U.S. equities market has been the default play amid global uncertainty from geopolitical factors and macroeconomic headwinds. That said, international equities could benefit in a 2024 market by rate cuts implemented by central banks around the world.