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Best Global ETFs

Looking for the best global ETFs to invest globally and diversify your investment portfolio? International ETFs are the perfect hedge against risks in domestic markets like the UK.

The top global ETFs cover developed and emerging markets, with a weighting toward developed markets worldwide.

I dedicated some time to analysing the international ETF market to highlight nine of the leading global ETFs to buy now, giving your long-term investment portfolio the benefit of broad-based diversification.

Discover: My guide to the best emerging market ETFs.

The Best Global ETFs of April 2024

Here are 9 of the most popular global ETFs to buy in April at a glance:

  1. Vanguard FTSE All-World UCITS ETF – Tracks the performance of the FTSE All-World Index, containing large and mid-cap international stocks within the FTSE Global Equity Index Series.
  2. MSCI All-Country World Index – Tracks almost 3,000 equities operating in 48 developed and emerging market economies.
  3. MSCI World UCITS ETF – Tracks large and mid-cap stocks listed within 23 developed markets operating in 11 different sectors.
  4. Vanguard FTSE All-World High Dividend Yield UCITS ETF – Tracks the performance of the FTSE All-World High Dividend Yield Index, which includes mid and large-cap stocks in developed and emerging markets with above average dividend yields.
  5. iShares Core MSCI Pacific ex-Japan UCITS ETF – Offers direct exposure to equities driving the biggest growth in the Asia-Pacific region, excluding Japan.
  6. SPDR MSCI World Financials UCITS ETF – Tracks the financial sector’s performance worldwide, including finance equities in developed markets.
  7. iShares Global Government Bond UCITS ETF – Tracks the performance of an index comprising local government bonds issued by governments within developed nations.
  8. Vanguard Global Aggregate Bond UCITS ETF – Tracks the performance of an index comprising government and investment-grade bonds issued around the world.
  9. Vanguard Emerging Markets Government Bond UCITS ETF – Tracks the performance of an index of US-denominated bonds issued by public organisations and governments in emerging nations.

Note: This is not a personal recommendation, nor does it constitute financial advice. Do not invest in these global ETFs based exclusively on what you read in this article. You should always conduct your own research before investing in new financial instruments.

1. Vanguard FTSE All-World UCITS ETF (VFPEF)

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The Vanguard FTSE All-World UCITS ETF is designed to mimic the performance of the FTSE All-World Index. The FTSE All-World Index comprises a basket of international stocks listed in developed and emerging markets. The equities involved are described as “large and mid-sized” companies, according to Vanguard’s key investor information sheet.

The index consists of around 3,900 stocks in almost 50 nations worldwide. It covers over 95% of the global investable market capitalisation. The assets under passive management are valued at £8.05 billion.

Had you invested in this international ETF a decade ago with £10,000, it would have yielded a return-on-investment worth well over 150%.

  • Fund size: £8.05 billion
  • Annual charges: 0.22%
  • Dividend yield: 1.97%
  • Best suited to: Retail investors looking to get exposure to the FTSE All-World Index, which includes some of the world’s most established corporations and emerging companies with immense growth potential.

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2. MSCI All-Country World Index (ACWI)

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The All-Country World Index (ACWI) is described as the “flagship global equity index” of MSCI. It’s designed to track the performance of many of the world’s leading mid-cap and large-cap stocks. The fund includes equities listed in 23 developed nations and 24 emerging nations. According to MSCI, it includes over 2,933 equities spread across 11 industries.

In terms of the allocation of assets within the All-Country World Index, MSCI adds constituents from the developed markets of North America, Europe, the Middle East, and the Pacific region. It also adds constituents from emerging markets in South America, Eastern Europe, Africa, and Asia.

If you had invested in the MSCI ACWI ETF from its inception, you’d currently be sitting on a total return on investment worth almost 145%.

  • Fund size: £13.4 billion
  • Annual charges: 0.32%
  • Dividend yield: 1.65%
  • Best suited to: Retail investors keen to diversify their portfolio on a global scale whilst driving sustainable, long-term growth.

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3. MSCI World UCITS ETF (IIREF)

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The MSCI World UCITS ETF tracks the MSCI World Index, featuring equities within the global stock market from up to 23 developed nations around the world. It is a long-only fund, which means that it only accepts long (buy) positions from retail investors.

This fund was listed for the first time in April 2009, and it’s not only one of the oldest international ETFs, but it also happens to be one of the most cost-effective. Its annual management fees are cheaper than the MSCI All-Country World Index and the Vanguard FTSE All-World UCITS ETF.

The MSCI World UCITS ETF has posted a return of 328.69% since April 2009. That’s compared with the 336.23% return of the MSCI World Index itself.

  • Fund size: £2.59 billion
  • Annual charges: 0.19%
  • Dividend yield: 0%
  • Best suited to: Retail investors looking for a low-fee global ETF with exposure to approximately 1,507 equities in developed nations.

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4. Vanguard FTSE All-World High Dividend Yield UCITS ETF (VNGGF)

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The Vanguard FTSE All-World High Dividend Yield exchange traded fund aims to mimic the benchmark performance of the FTSE All-World High Dividend Yield index, consisting of equities that deliver dividend yields consistently above the market average. It excludes real estate trusts, but it does include high yielding stocks in emerging markets as well as developed markets.

If you’re wondering which equities are considered high dividend payers, those carrying the greatest weighting in this global ETF include Exxon Mobil, Johnson & Johnson, JP Morgan Chase & Co., Procter & Gamble, Nestle, and Chevron.

Almost a quarter (24.49%) of the equities within this fund are from the financial sector. More than two-fifths (42.3%) of constituents are US-based, although plenty of assets are listed in Japan, the UK, Switzerland, and many more.

  • Fund size: £3.2 billion
  • Annual charges: 0.29%
  • Dividend yield: 3.98%
  • Best suited to: Retail investors looking for a diversified international ETF that pays regular and above average dividends.

Best Range of ETFs at InvestEngine

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Whenever you invest, your capital is at risk. Minimum investment £100, T&Cs apply.

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5. iShares Core MSCI Pacific ex-Japan UCITS ETF (CPXJ.L)

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If you’d like to get more exposure to well-established, multinational equities in the Asia Pacific region, this is one of the more exotic global ETFs to consider. As the name suggests, the iShares Core MSCI Pacific ex-Japan ETF excludes Japanese stocks and instead focuses on nurturing a basket of equities from elsewhere in the international markets like Australia, Singapore, New Zealand, and Hong Kong.

This international ETF launched in January 2010. It happens to be one of the more expensive global funds on this list, but that’s largely due to the ‘exotic’ nature of having a basket of Pacific equities managed on your behalf.

Had you chosen to invest in this fund from the outset, you’d be looking at a total return on investment of 76.40%. That’s not a bad performance considering the benchmark index returned only a little bit more (83.07%).

  • Fund size: £153.74 million
  • Annual charges: 0.60%
  • Dividend yield: 4.06%
  • Best suited to: Retail investors looking for regional exposure to the Asia Pacific region as a potential hedge to investments in developed western markets.

Best Range of ETFs at InvestEngine

  • Choose from over 550+ ETFs
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Whenever you invest, your capital is at risk. Minimum investment £100, T&Cs apply.

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6. SPDR MSCI World Financials UCITS ETF (FNCW.L)

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This international ETF is aimed at those wanting to track the performance of the leading equities in the global financial sector. The SPDR MSCI World Financials ETF is a basket exclusively of financial stocks in developed markets around the world. The fund is rated six out of seven on the risk-reward profile within its key investor information, which means there is a potential for higher-than-average returns and similarly higher than average volatility.

There is no dividend yield with this global ETF, as all dividends are accumulating, helping to add to the overall value of the fund.

  • Fund size: £153.74 million
  • Annual charges: 0.60%
  • Dividend yield: 0%
  • Best suited to: Retail investors looking for regional exposure to the Asia Pacific region as a potential hedge to investments in developed western markets.

Best Range of ETFs at InvestEngine

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Whenever you invest, your capital is at risk. Minimum investment £100, T&Cs apply.

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7. iShares Global Government Bond UCITS ETF (IIXFF)

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The Global Government Bond ETF from iShares is designed to track the returns made by the FTSE G7 Government Bond index. Essentially, this index includes a basket of bonds issued or guaranteed by all seven governments within the G7 – the UK, USA, France, Germany, Italy, Canada, and Japan.

This global ETF is typically considered a safe option, as local currency bonds of developed nations offer some of the most secure returns available. Some investors may look to this type of international ETF as a convenient hedge against riskier investments in equities.

This bond generally performs well when inflation is low and gilt yield prices are lower. The issue of rampant inflation since Covid-19 and the war in Ukraine has hit this particularly hard, falling 16.83% in the last three years. Since its inception in March 2009, it has still delivered a return on investment of 11.67% – a solid if unspectacular gain.

  • Fund size: £1.93 billion
  • Annual charges: 0.20%
  • Dividend yield: 1.02%
  • Best suited to: Retail investors seeking a global ETF that’s historically generated small, incremental gains, ideal for long-term investing.

Best Range of ETFs at InvestEngine

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Whenever you invest, your capital is at risk. Minimum investment £100, T&Cs apply.

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8. Vanguard Global Aggregate Bond UCITS ETF (VGRSF)

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This global ETF is an accumulating fund that tracks the Bloomberg Global Aggregate Float Adjusted and Scaled Index. Essentially, this broad market index contains a basket of government and corporate bonds issued from all four corners of the globe. Corporate bonds are considered investment-grade, which means they are some of the safest bonds to purchase in global commerce.

All bonds included in this fund have a maturity of more than 12 months. Vanguard states that its fund managers may also invest in similar bonds beyond this Bloomberg index to a lesser extent, whenever they see fit.

Approximately 25.57% of this fund’s holdings originate from the US, followed by Japan (7.44%), France (4.72%), and Germany (3.55%). Bonds from “other”’ nations make up 58.72% of the fund.

  • Fund size: £127.7 million
  • Annual charges: 0.10%
  • Dividend yield: 1.72%
  • Best suited to: Retail investors seeking an international ETF with a very low expense ratio and a steady dividend yield.

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Whenever you invest, your capital is at risk. Minimum investment £100, T&Cs apply.

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9. Vanguard Emerging Markets Government Bond UCITS ETF (VWOB)

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Vanguard’s Emerging Markets Government Bond ETF tracks Bloomberg’s Emerging Markets USD Sovereign + Quasi-Sov index. There are US dollar bonds issued by governments and semi-public institutions in emerging nations.

All bonds featured in this fund have a maturity of more than 12 months and have no constraints in terms of credit ratings. Like Vanguard’s Global Aggregate Bond ETF, this fund may also invest in similar bonds outside of the Bloomberg index on occasion.

Approximately 6.17% of this fund’s holdings originate from Mexico, followed by Indonesia (5.75%), Saudi Arabia (5.49%), and the United Arab Emirates (5.13%). Bonds from “other” nations make up the remaining 77.46% of the fund.

  • Fund size: £341.82 million
  • Annual charges: 0.25%
  • Dividend yield: 5.13%
  • Best suited to: Retail investors seeking a global ETF with a track record of a strong dividend yield, paid monthly to shareholders.

Best Range of ETFs at InvestEngine

  • Choose from over 550+ ETFs
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Whenever you invest, your capital is at risk. Minimum investment £100, T&Cs apply.

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Why invest in Global ETFs?

In these uncertain economic times, diversification is a sensible investment strategy. World ETFs spread your exposure across influential equities in both developed and emerging markets.

Investing in assets outside of the UK economy can act as a much-needed hedge against domestic volatility caused by the ongoing cost-of-living crisis. Global ETFs (exchange traded funds) carefully balance risk and reward, with their funds heavily weighted towards well-established companies within developed markets. They still afford plenty of opportunity for equities within emerging markets to generate sufficient returns for the fund.

A well-balanced investment portfolio means your holdings rarely move in lockstep. When a cluster of assets rises in value, some may begin to fall in value. The hope is that the gains will outweigh the losses over time, generating sustainable long-term returns.

How do I invest in Global ETFs?

Global ETFs track assets in the same way as domestic ETFs listed on the London Stock Exchange. There are two types of international ETFs – passively managed world ETFs and actively managed world ETFs.

A passive international ETF comprises a basket of equities hand-picked from around the world to create a broad-based index. When buying shares in a passive global ETF, you’ll get direct exposure to the overall index. The index essentially replicates the performance of all the selected stocks. As the fund operates virtually autonomously to track benchmark performance, management fees are minimal.

An actively managed global ETF also consists of a basket of equities selected by a fund manager in line with the general ‘theme’ of the fund. It could be based on certain industries or specific countries.

Either way, the fund regularly chops and changes its holdings, which is where fund managers earn their corn, hence the higher management fees for actively managed ETFs. Actively managed ETFs don’t just incur higher fees; they also tend to be more volatile as their composition of assets evolves more frequently.

Also consider: The best ETFs to buy now in the UK.

Best Global ETFs FAQs

What is the best performing ETF in the world?

The best performing global ETF is the Vanguard FTSE All-World UCITS ETF. This tracks stocks from developed and emerging markets worldwide and is up 54.14% in the last five years to May 31, 2023.

What is the most globally diversified ETF?

The most globally diversified ETF is the MSCI All Country World-Index. Its composition spans companies in 23 developed markets as well as 24 emerging markets to cover all bases.

Please note

The value of your investments (and any income from them) can go down as well as up and you may not get back the full amount you invested. Past performance is not a reliable indicator of future performance. Investments should be considered over the longer term and should fit in with your overall attitude to risk and financial situation.

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