Vanguard All-World ETF Notches Record Close as Ex-US Markets Outperform and Index Undergoes Historic Reshuffling

Vanguard FTSE All-World ETF hits yearly high at €160.88, driven by global rotation away from US. Emerging markets outperform, with Vietnam and Greece reclassification coming.

Global investors are being rewarded for casting a wider net. The Vanguard FTSE All-World UCITS ETF (VWCE) closed at a fresh yearly high of €160.88 on Thursday, bringing its year-to-date gain to 10.21%. Over the past twelve months, the fund has returned 23.51%, but what’s driving that performance is a marked shift away from the long-dominant US market.

International equities have stolen the show in 2025. The FTSE All-World ex US index delivered a return of 32.6% in dollar terms, handily beating the FTSE USA index’s 18% advance. A weaker greenback has provided an extra tailwind for non-US stocks. That rotation plays directly into the hands of a truly global fund that captures roughly 90% of the world’s investable market capitalisation.

At the same time, the underlying index is preparing for its most significant geographic overhaul in years. On 21 September 2026, FTSE Russell will upgrade Vietnam from a frontier to a secondary emerging market, adding it as the index’s 49th member country. To prevent market disruption, Vietnamese equities will be phased in over four tranches spanning a full year. Despite a likely weight of just 0.02% — small on the surface — the sheer size of the fund, which holds over $57 billion in assets, means meaningful capital will flow into the Southeast Asian market.

Greece is also moving up the ranks, shifting from emerging to developed market status on the same date. That double reclassification will redistribute weightings within the index, further tilting the portfolio toward regions that are currently delivering the strongest earnings growth forecasts. According to the article, the most aggressive profit-per-share projections are coming from emerging markets and Asia excluding Japan.

Emerging markets have already been pulling their weight. The FTSE Emerging index gained 26.5% in 2025, outpacing the developed-market index’s 22.8% advance. Demand for semiconductors, solar energy and robotics has fuelled the rally, and a softer dollar is giving central banks in these regions more room to cut rates. Latin America, in particular, stands to benefit.

None of this means the US has lost its grip on the index. American equities still account for roughly two-thirds of the total weight. Japan follows at about 5%, with China and Britain trailing. Technology remains the dominant sector, representing about a quarter of the index, while financials contribute around 15%.

The heavyweights are familiar names. Nvidia leads the portfolio with a 4.48% weighting, followed by Apple at 4.01% and Microsoft at 3.01%. Other top holdings include Alphabet, Amazon, Broadcom, TSMC, Meta, and Berkshire Hathaway. The fund’s performance is thus still heavily influenced by these megacaps, even as the broader market starts to broaden out.

Vanguard uses physically optimised sampling to track the index — holding a representative subset of roughly 85% of the more than 4,200 constituents — which keeps transaction costs low. The ongoing charge stands at 0.19% per year. As of late March, the total fund had $57.48 billion in assets, with the accumulating share class representing $35.74 billion. Morningstar rates the strategy favourably, citing the low cost and broad coverage; over one year the fund’s net return of 20.01% was nearly identical to the benchmark’s 20.04%.

From a technical perspective, the trend remains intact. The closing price sits 7.29% above its short-term moving average, and the relative strength index is at 63.1 — still below overbought territory. A pullback toward €150 would be the first clear sign of waning momentum. With valuations already elevated after delivering north of 23% in 2025, investors are increasingly looking to earnings growth for the next leg higher. And the upcoming addition of Vietnam, combined with the existing breadth across 48 current countries, positions this ETF to capture that growth wherever it emerges.