Time and time again, the markets have not reacted well to cooling labor market data. In the U.S. Department of Labor reports for both July and August, job growth came in at lower levels than expected. In turn, these findings triggered fresh recession fears, prompting selloffs in the stock market. With recession concerns weighing on investors, this trend won’t be going away any time soon. And with an upcoming U.S. presidential election, domestic equities might be heading for more bouts of volatility.
Keeping all of this in mind, investors may wish to add some diversification away from U.S. equities to avoid volatility. Moments like these are where international equity strategies can really shine.
The Calvert Strategy Versus Volatility
For a good example, take a closer look at the Calvert International Responsible Index ETF (CVIE ). CVIE offers investors access to a diversified portfolio of large-cap equities across the globe.
In CVIE’s portfolio, the fund holds broad exposure to a number of competitive countries around the world. In particular, the fund holds a somewhat heavier position in Japan.
Holding stronger exposure to Japan-tied companies can make a lot of sense right now. Earlier this week, Japan reported that its economy continued to grow through the April-June quarter.
While this growth was slightly lower than estimated, the numbers support that the country’s wages and spending are continuing to recover. Additionally, this data should serve as a signal for the Bank of Japan to continue increasing interest rates.
Along with a well-diversified international portfolio, CVIE utilizes Calvert’s extensive expertise in ESG research. By leveraging an ESG framework, the fund can cultivate responsible companies that offer competitive, long-term business models.
Right now, CVIE is offering extremely competitive long-term results. As of September 12th, 2024, the fund’s NAV has risen 5% over the last month alone. Meanwhile, CVIE’s NAV is up nearly 20% over the last year.
For more news, information, and analysis, visit The ETF Yield Channel.
