Your Gateway to International Small-Cap Stocks🗺️

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Hello, ETF UNO readers! Welcome to another enriching exploration of ETF investing. Today, we delve into the AVDV ETF, a compelling investment avenue renowned for its innovative approach and promising advantages in international markets. Here's what lies ahead:

• Introduction to AVDV ETF: Provider, focus, and strategy

• Examination of its benchmark index and unique investment approach

• Analysis of its diverse holdings and strategic benefits

• Insight into historical performance and critical statistics

• Compelling reasons to consider and carefully evaluate AVDV ETF for your portfolio

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What is AVDV?

The Avantis International Small Cap Value ETF (AVDV), provided by Avantis Investors, is designed to offer exposure to the exciting world of international small-cap companies. Avantis Investors, known for its evidence-based approach to investing, aims to deliver superior outcomes by combining academic insights with practical implementation. The AVDV ETF is an excellent option for investors looking to diversify their portfolios with international stocks, particularly those who want to tap into the potential of the dynamic smaller companies outside the United States.

Harnessing the Power of Active Benchmarking 🎯

While the MSCI World ex USA Small Cap Index serves as a benchmark, encompassing small-cap gems from 22 developed markets across sectors galore, the AVDV ETF goes a step further. Rather than merely mirroring the index, it actively benchmarks against it, empowering its investment team to make strategic decisions based on rigorous analysis and current market dynamics.

This active benchmarking approach enables AVDV to capitalise on pricing inefficiencies, seizing opportunities that passive index replication may overlook. By handpicking promising small-cap stocks from the vast global pool, the fund aims to enhance returns and outperform the benchmark, leveraging its investment prowess to identify undervalued gems ripe for growth.

Diversification: The Foundation of Stability📊

As we mentioned many times in our articles, especially the InvestWise edition covering diversification, there are benefits of keeping the diversification of an investment:

• 🛡️Risk Reduction: Spreading investments across numerous stocks and sectors lowers the risk of significant losses.

• 💼Stable Returns: Diversified portfolios are less susceptible to market swings, leading to more consistent performance.

• 🌍Broader Exposure: Investing in a wide array of stocks offers exposure to various growth opportunities worldwide.

The AVDV ETF boasts a standout feature that sets it apart – a massive portfolio comprising over 1,000 individual small-cap stocks from around the globe. This extensive diversification across numerous companies, sectors, and regions is a robust risk management tool. By spreading your investments across such a wide array of holdings, the impact of any single stock's performance on your overall portfolio is significantly reduced.

The AVDV ETF's well-diversified international small-cap holdings are a stabilising force, smoothing out volatility and providing a solid foundation for long-term growth. With such broad allocation, you can invest with optimism, knowing that your portfolio is not overly reliant on the fortunes of any single investment and is positioned for long-term growth.

AVDV at a glance

ETF Issuer: Avantis Investors

Inception: 24/09/2019

Asset Class: Equity

Underlying Index: AVDV is actively managed, with MSCI World ex USA Small Cap Index as benchmark

Geographical Focus: Developed Markets (non U.S.)

Expense Ratio: 0.36% (as of last data point)

Dividend Yield: 3.13% (as of last data point)

Distribution Frequency: Semi-Annual

Historical Performance

AVDV only has slightly less than five years of performance since its inception. It has demonstrated strong performance, consistently outperforming many of its peers. Let's look at some key statistics:

• Annualised Returns: The ETF has delivered competitive returns with 26.5% of 1-year return and 3.85% of 3-year annualised return, reflecting its effective investment strategy.

• Volatility: While small-cap stocks can be volatile, the ETF's robust diversification strategy effectively manages this risk, providing potential investors with security.

• Dividend Yield: AVDV also offers a solid dividend yield, providing an additional income stream for investors.

ETF Radar View

The radar chart below shows the general characteristics of the ETF:

Top 3 Reasons to Invest

1. International and Small-Cap Exposure: Investing in international markets can provide diversification benefits and exposure to growth opportunities beyond domestic borders. The ETF targets small-cap stocks that are often undervalued, providing growth potential as these companies gain recognition.

2. Active Management: By actively benchmarking against the MSCI index, AVDV seeks to outperform passive funds through strategic investment choices.

3. Diversification: With over 1,000 holdings, AVDV offers excellent diversification, potentially mitigating risk and reducing portfolio volatility.

Top 3 Reasons Not to Invest

1. Market Volatility: International small-cap stocks can be more volatile than their large-cap counterparts, potentially exposing investors to higher levels of risk.

2. Management Risks: While active management strategies may underperform their benchmarks, they also have the potential to outperform, leading to higher returns than a passively managed alternative.

3. Fees: AVDV's active management approach may result in higher costs than passively managed ETFs, potentially impacting long-term returns.

📈Discover the Non-US Small-Cap Opportunities

The AVDV ETF presents a unique opportunity for investors seeking international small-cap exposure through an actively managed approach. Its diversified holdings, potential for enhanced returns, and access to global markets make it an attractive choice. However, weighing the potential benefits against the inherent risks, such as market volatility, currency fluctuations, and management risks, is crucial.

By exploring the AVDV ETF, we've shared exclusive insights that have piqued your interest in international ETF investing. Remember, becoming a part of the ETF UNO community not only grants you access to in-depth analyses and expert advice but also keeps you at the forefront of the latest developments in the world of ETFs. Start your journey with us today!

DISCLAIMER: The information in this article is for educational purposes and should not be taken as investment advice. Investors should conduct their own research or consult a financial advisor before making investment decisions.