As tariff risk becomes part of the 2025 investing calculus, many investors are choosing to look for opportunities overseas. The T. Rowe Price International Equity ETF (TOUS ) is worth consideration, given its actively managed strategy and performance this year.
The announcement of trade deals commencing between the U.S. and the U.K., as well as the U.S. and China, lifted U.S. equity markets this month. However, ongoing uncertainty regarding tariffs and U.S. economic policy looms large over markets. Despite a favorable April CPI print this week, the impending inflationary and economic impact of U.S. tariffs dampened market enthusiasm.
While the constantly changing U.S. tariff policy creates risk for most countries, it also creates potential benefits. Industrial production in Germany surged in March, with factor orders rising 3.6% sequentially in the month after February’s flat performance, T. Rowe Price reported in a recent Global Markets Weekly Update.
Rates continue to appear favorable for many countries as well. The Bank of England recently cut rates by 0.25% while Swedish and Norwegian banks signaled potential easing later this year. In the Asia-Pacific region, China’s continued easing and supportive monetary policies could help to combat tariff impacts.
Additional strengthening of trade by China within the region and abroad in recent years could also prove advantageous. In April, “exports to India, Southeast Asian countries, and the European Union soared as Chinese companies offset the U.S. sales drop with sales to other markets,” T. Rowe noted.
Invest Internationally With Actively Managed, Outperforming TOUS
Active management could prove a boon in a volatile, evolving market environment. With a number of opportunities existing internationally this year, looking to an active strategy that relies on fundamental analysis when constructing portfolios would be beneficial. Those advisors and investors wanting to harness opportunities overseas should consider the actively managed T. Rowe Price International Equity ETF (TOUS ), given its outperformance this year over the benchmark MSCI All Country World Index Ex-US.
TOUS’s fund managers take macro factors into account when constructing the portfolio. These include sector, industry, and individual country outlooks. However, the main focus centers on the bottom-up research and fundamentals of individual companies.
While TOUS invests across the market-cap spectrum, the strategy generally focuses on large-caps in developed markets. The fund managers evaluate a company’s earnings potential, its fundamentals, and relative valuation to peers when constructing the portfolio. This results in a portfolio that may offer both value and growth exposures at any given time.
The fund offers notable portfolio benefits this year, given tendency for investors to have been overweighted in U.S. equities and large-cap concentrations during the past several years. Top countries invested in by TOUS included Japan (21.23%), the U.K. (19.49%), France (12.11%), and Germany (9.88%) as of the end of April 2025. The country weights are generally the result of the bottom-up stock selection. However, the manager may limit an individual country’s weight should its macro outlook appear less favorable.
TOUS also provides diversification at the sector level for those looking to diversify their exposures after years of tech concentration. The fund’s top sector allocations included financials (23.38%), industrials (16.63%), and health care (11.06%) as of April 30, 2025. As with country weights, the manager may limit sector/industry exposures depending on the macro environment and outlooks.
TOUS has a management fee of 0.50%, which is competitive among international ETFs, especially those with an active research-driven approach.
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