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. Several factors since then have boosted the case for international, and international equity ETF strategies have benefitted. One such strategy from Avantis Investors currently sits among the top five YTD international performers and merits a closer look.
See more: Emerging Markets ETF AVEM Adds Over $5 Billion YTD
The Avantis International Small Cap Value ETF (AVDV ) has returned 45% YTD, according to ETF Database data. That puts it third among all global, ex-U.S. ETFs with at least $100 million in AUM and second when excluding leveraged, tactical funds. The international equity ETF has added more than $5 billion in the last 12 months, as well, bringing its AUM to just $14.5 billion.
AVDV's International Equity ETF YTD Record
How, then, has the fund reached those milestones and what role might it play for curious investors? AVDV applies Avantis Investors’ approach that looks to combine the strengths of indexing, like transparency, limited turnover, and diversification, with active flexibility.
For AVDV, specifically, the strategy looks for small-cap value firms outside the United States. It spans companies across market capitalization levels, market sectors, industry groups, and more. Its managers retain the freedom to use fundamental criteria like cash flow, revenue, shares outstanding, and price-to-book value to assess potential candidate companies.
That has led the international equity ETF to invest in firms like Perseus Mining Ltd. (PMNXF) and Regis Resources Ltd. (RGRNF), which have returned 122% and 220% YTD, respectively. Both of those firms focus on mining mineral wealth, an industry that has performed well this year.
Looking ahead, AVDV could retain much of its appeal in the new year. Domestic uncertainty in the U.S. may see investors look elsewhere, while gold demand may continue to grow. The U.S. dollar’s decline, too, may cast foreign equities in a kinder light, as well. Taken together, the strategy has a case to retain its top status in 2026.
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