The Vanguard MSCI Index International Shares ETF (ASX:VGS) has more than doubled the ASX 200's returns in 2021

Why is this ETF performing so strongly in 2021?

| More on:
One girl leapfrogs over her friend's back.

Image source: Getty Images

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

Investors in the Vanguard MSCI Index International Shares ETF (ASX: VGS) have something to cheer about in 2021.

Despite only being up a measly 0.12% today, at the time of writing to $100.93, the VGS share price has had a phenomenal 2021. Since the beginning of the year, shares in the popular exchange-traded fund (ETF) have appreciated 20.2%. For context, the S&P/ASX 200 Index (ASX: XJO) is up 8.74% since 1 January. In other words, VGS has more than doubled the gains of the benchmark index.

Let's take a closer look at the ETF.

What is VGS invested in?

As The Motley Fool has previously reported, VGS is invested in over 1500 shares, none of which are listed on the ASX.

These 5 companies, all listed on NASDAQ, individually account for more than 1% of the fund's total:

Other notable companies the ETF is invested in include Tesla Inc (NASDAQ: TSLA), Pfizer Inc. (NYSE: PFE), PayPal Holdings Inc (NASDAQ: PYPL) and Visa Inc (NYSE: V).

Whatever shares the fund is invested in, it's clearly doing wonders for shareholders in its ASX-traded ETF.

What are the professionals saying about ASX VGS?

The Motley Fool's own Scott Phillips says VGS can be a good starting point for ASX investors. Buying into the fund gives investors instant access to 1505 of the biggest companies outside of Australia. Vanguard also offers an ASX alternative, the Vanguard Australian Shares Index ETF (ASX: VAS). This gives investors access to the 300 largest companies on the ASX.

Another reason Vanguard may be attractive to investors is its low rates. With a management fee of just 0.18%, it's a lot lower than a lot of other managed funds.

John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool’s board of directors. Teresa Kersten, an employee of LinkedIn, a Microsoft subsidiary, is a member of The Motley Fool’s board of directors. Randi Zuckerberg, a former director of market development and spokeswoman for Facebook and sister to its CEO, Mark Zuckerberg, is a member of The Motley Fool's board of directors. Motley Fool contributor Marc Sidarous has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. owns shares of and has recommended Alphabet (A shares), Alphabet (C shares), Amazon, Apple, Facebook, Microsoft, PayPal Holdings, Tesla, Vanguard MSCI Index International Shares ETF, and Visa. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has recommended the following options: long January 2022 $1,920 calls on Amazon, long January 2022 $75 calls on PayPal Holdings, long March 2023 $120 calls on Apple, short January 2022 $1,940 calls on Amazon, and short March 2023 $130 calls on Apple. The Motley Fool Australia has recommended Alphabet (A shares), Alphabet (C shares), Amazon, Apple, Facebook, PayPal Holdings, and Vanguard MSCI Index International Shares ETF. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

More on ETFs

A cool young man walking in a laneway holding a takeaway coffee in one hand and his phone in the other reacts with surprise as he reads the latest news on his mobile phone
ETFs

5 excellent ASX ETFs to buy now

These funds could be great options for investors wanting to make portfolio additions in 2026.

Read more »

A man in a suit stands before a large backdrop of a blue-lit globe as the man smiles and holds his hand to his chin as though thinking.
ETFs

Astronomical returns: Best 6 ASX ETFs holding international shares for 2025

These ASX ETFs delivered astronomical total returns of between 81% and 156% last year.

Read more »

a woman wearing a sparkly strapless dress leans on a neat stack of six gold bars as she smiles and looks to the side as though she is very happy and protective of her stash. She also has gold fingernails and gold glitter pieces affixed to her cheeks.
Gold

With gold up 71%, which is the best ASX gold ETF to buy?

Investors are spoilt for choice when it comes to gold.

Read more »

A happy couple relax in a hammock together as they think about enjoying life with a passive income stream.
ETFs

Passive income investors: This ASX stock has a 7.4% dividend yield with monthly payouts

This stock is a fantastic monthly earner.

Read more »

Man looking at an ETF diagram.
ETFs

2 ASX ETFs I'd buy aiming for big returns for the next 5 years

These funds have big potential over the long term.

Read more »

Small business family created to include people with disabilities in order to have equal opportunity as everyone else.
ETFs

These are the ETFs I would buy with $20,000

Rather than trying to find one perfect investment, I would use ETFs to build diversified exposure to global leaders, Australian…

Read more »

Smiling young parents with their daughter dream of success.
ETFs

3 ETFs I think could outperform NAB shares in 2026

When returns from a mature bank look limited, global and thematic ETFs can offer a different growth profile.

Read more »

Man holding out $50 and $100 notes in his hands, symbolising ex dividend.
Dividend Investing

Own VTS ETF? It's a great day for you!

This exchange-traded fund seeks to mirror the performance of the entire US stock market.

Read more »