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. Myriad factors have contributed to that success, but right now, with the new year looming, the real question is: Which international ETF should investors consider?
See more: Avantis Investors Hits $100 Billion in AUM as AVUV Hits $20 Billion
One red hot fund that shouldn’t be ignored is the Avantis International Small Cap Value ETF (AVDV ). The strategy charges 36 basis points (bps) for its approach to ex-U.S. small-cap value names. Avantis Investors’ approach, which combines the strengths of active, fundamental research and flexibility, and passive, like low costs and diversification, has helped the strategy return 47% YTD.
International ETF AVDV: Ready for 2026?
That has helped the small-cap value international ETF outperform its ETF Database Category average of 33.1% in that time. AVDV has also continued to outperform since the early year Liberation Day spike for international equities. The strategy has outperformed that average over both three- and one-month periods as of December 16, per ETF Database data. It has also outperformed over three- and five-year periods, too.
The strategy’s managers lean on fundamental criteria, looking for companies they identify as highly profitable value firms. Specifically, AVDV emphasizes metrics like shares outstanding, cash flow, revenue, expenses and price-to-book value.
The fund has done well this year, then, but what might its outlook be in the next year? The key wrinkle boosting AVDV’s case in 2026 may be its small-cap value focus. Where other broad, passive-specific international ETF strategies simply track their indexes, AVDV offers flexibility and a focus on companies that may be able to do well even facing geopolitical or economy uncertainty.
International equities offer diversification away from domestic U.S. uncertainty, an appeal on its own. The added upside available in an international ETF like AVDV may make it one to consider with a new year just over the horizon.
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