Is the Vanguard MSCI Index International Shares ETF the best long-term investment?

Is the Vanguard MSCI Index International Shares ETF (ASX:VGS) the best long-term investment to buy right now?

| More on:

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Is the Vanguard MSCI Index International Shares ETF (ASX: VGS) the best long-term investment right now?

Vanguard MSCI Index International Shares ETF

Diversification

The more shares you have exposure to the lower the risk of individual companies. This is useful with the coronavirus impacts. This ETF is invested in almost 1,600 businesses across the world.

It's not just the number of businesses that provide good diversification, but it's also the underlying geographic spread. The ETF is invested across the US, Japan, the UK, Switzerland, France, Canada, Germany, the Netherlands, Hong Kong, Spain and so on.

I think ETF is invested in many of the world's best businesses. Some of its holdings are: Microsoft, Apple, Amazon, Alphabet, Facebook, Visa and so on. Being invested in the best should mean solid long-term returns.

The fees

When you're invested in an exchange-traded fund (ETF) which tracks an index you want to make sure that it has low fees. The lower the fee the more of the net returns that are left in your hands. Vanguard is one of the best ETF providers in the world. 

Vanguard MSCI Index International Shares ETF has an annual management fee of 0.18% per annum. It's not the lowest there is, but it's very low compared to most active fund managers.

Is it a dividend share?

An ETF simply passes through the income it receives from its holdings. A lot of the ETF's holdings don't pay a big dividend. Even so, at the end of March 2020 it had a dividend yield of 2.8% which isn't bad compared to the official central bank interest rates.

Is it a buy?

Vanguard MSCI Index International Shares ETF could be one of the best ideas as a 'buy and hold' forever pick without having to do much research on it. Its holdings will regularly change to reflect the growing companies taking up larger positions in the portfolio over time.

I'd be happy to invest in it today because it's down 15% (including the weakening of the Australian dollar). But there could be more declines to come. So I'd keep some cash on the side. 

Should you invest $1,000 in Vanguard Msci Index International Shares Etf right now?

Before you buy Vanguard Msci Index International Shares Etf shares, consider this:

Motley Fool investing expert Scott Phillips just revealed what he believes are the 5 best stocks for investors to buy right now... and Vanguard Msci Index International Shares Etf wasn't one of them.

The online investing service he’s run for over a decade, Motley Fool Share Advisor, has provided thousands of paying members with stock picks that have doubled, tripled or even more.*

And right now, Scott thinks there are 5 stocks that may be better buys...

See The 5 Stocks *Returns as of 9 January 2025

Motley Fool contributor Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia has recommended Vanguard MSCI Index International Shares ETF. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

More on Index investing

Index investing

$1,000 invested in the iShares S&P 500 ETF (IVV) at the start of 2021 is now worth…

This high-flying ETF has banked some stunning returns...

Read more »

A recreational fisherman holds a fishing rod with his hands apart indicating it was this big with a smile on his face.
Index investing

$10,000 invested in the Vanguard Australian Shares Index ETF (VAS) at the start of 2020 is now worth…

The returns of this popular index fund might surprise you...

Read more »

A young office worker is surrounded by peers who are clapping and congratulating her.
ETFs

What are the most popular ASX ETFs in Australia?

You might own one or more of these popular ETFs...

Read more »

A young woman drinking coffee in a cafe smiles as she checks her phone.
Index investing

Own the Vanguard International Shares ETF (VGS)? You banked 30% in 2024

This ETF was a lucrative one to own last year...

Read more »

Happy young couple saving money in piggy bank.
Index investing

$20,000 invested in the ASX 200 at the start of 2024 is now worth…

Investors have made more from dividends than growth over the past year...

Read more »

Businessman using a digital tablet with a graphical chart, symbolising the stock market.
Share Market News

What is the Dow Jones Index and which 30 companies make the grade?

Here is a brief history of the world's oldest share market index.

Read more »

Young boy in business suit punches the air as he finishes ahead of another boy in a box car race.
Index investing

Want to outperform 82% of professional fund managers? Buy these ASX ETFs

It's easier than you'd think to beat most ASX fund managers.

Read more »

Man smiling at a laptop because of a rising share price.
Index investing

The ultimate guide to investing in the Vanguard Australian Shares Index ETF (VAS) for maximum returns

This strategy should get you the best bang for your buck with VAS.

Read more »