Spotlight: Vanguard MSCI Index International Shares ETF (ASX: VGS)
Over the past 18 months, we've been using our Spotlight series to shine a light on our ETF portfolios. We're now expanding the series to focus on the individual ETFs that help power those portfolios - or are available through InvestSMART Custom.
This time, we're focusing on the Vanguard MSCI Index International Shares ETF (ASX: VGS), which we use to provide exposure to international shares. Here's what you need to know.
About the Vanguard MSCI Index International Shares ETF (ASX: VGS)
The Vanguard MSCI Index International Shares ETF (ASX: VGS) invests in around 1,300 companies from developed countries, excluding Australia.
Vanguard says the ETF suits buy-and-hold investors seeking long-term capital growth, international diversification and who have a higher tolerance for the risks associated with investing in the share market. The ETF is not hedged, so investors will also be exposed to currency fluctuations.
Here are a few quick facts about VGS:
- Investment manager: Vanguard
- Inception date: 18 November 2014
- Size: $12.6 billion
- Management fee: 0.18% p.a.
- Benchmark index: MSCI World ex-Australia (with net dividends reinvested) in Australian dollars Index
- InvestSMART rating: 5 stars
- Distribution frequency: Quarterly
Where is VGS invested?
The ETF is currently invested in 1,280 companies. The top 10 holdings, which make up 26.5% of the portfolio, are listed below.
Top 10 holdings
|
Company |
% of assets |
|
NVIDIA |
5.5% |
|
Microsoft |
4.6% |
|
Apple |
4.5% |
|
Amazon |
2.8% |
|
Meta Platforms |
2.1% |
|
Broadcom |
1.7% |
|
Alphabet |
1.6% |
|
Alphabet |
1.4% |
|
Tesla |
1.2% |
|
JPMorgan Chase & Co |
1.1% |
Source: Vanguard. Holdings as of 31 August 2025.
VGS has investments in about 20 countries, with the vast majority in the US. The top 10 are:
Market allocations
|
Country |
Fund |
|
United States |
73.8% |
|
Japan |
5.4% |
|
United Kingdom |
3.7% |
|
Canada |
3.2% |
|
France |
2.8% |
|
Germany |
2.6% |
|
Switzerland |
2.3% |
|
Netherlands |
1.1% |
|
Sweden |
0.9% |
|
Spain |
0.9% |
Source: Vanguard. Holdings as of 31 July 2025.
From a sector perspective, as of 31 July 2025, VGS's holdings include Information Technology (27.3%), Financials (16.6%), Industrials (11.5%), Consumer Discretionary (10.2%) and Health Care (9.1%).
How has VGS performed?
VGS has delivered strong long-term results, returning an average of 13.61% a year since it launched in November 2014. In the 12 months to the end of August 2025, it was up 20.09%.
VGS performance
|
1 year |
3 yrs p.a. |
5 yrs p.a. |
10 yrs p.a. |
SI p.a.1 |
|
|
Total return |
20.09% |
20.55% |
15.80% |
12.68% |
13.61% |
|
Benchmark |
20.06% |
20.50% |
15.74% |
12.60% |
13.51% |
Source: Vanguard. Returns for the period ending 31 August 2025. 1Since inception on 18 November 2014.
Key takeouts
VGS provides simple, low-cost access to global sharemarkets, excluding Australia, with a strong bias towards US companies. It has delivered excellent long-term returns while closely tracking its benchmark. Of course, keep in mind that past performance is not a guarantee of future returns. As the ETF is unhedged, investors are also exposed to currency movements.
Want to compare ETFs? Check out our handy online ETF filter tool. It can help you narrow down your options based on filters such as investment category or InvestSMART's star rating. If you'd like help selecting the right InvestSMART ETF portfolio for you check out our free statement of advice quiz. It will show you which one may best suit your goals and investment timeframe.
Frequently Asked Questions about this Article…
The Vanguard MSCI Index International Shares ETF (ASX: VGS) is an exchange-traded fund that invests in approximately 1,300 companies from developed countries, excluding Australia. It aims to provide long-term capital growth and international diversification for investors.
The VGS ETF is suitable for buy-and-hold investors who are seeking long-term capital growth and international diversification. It is ideal for those with a higher tolerance for the risks associated with investing in the share market.
As of August 2025, the top holdings in the VGS ETF include NVIDIA, Microsoft, Apple, Amazon, Meta Platforms, Broadcom, Alphabet, Tesla, and JPMorgan Chase & Co, making up 26.5% of the portfolio.
Since its inception in November 2014, the VGS ETF has delivered an average annual return of 13.61%. In the 12 months to the end of August 2025, it achieved a return of 20.09%.
The management fee for the VGS ETF is 0.18% per annum, making it a cost-effective option for investors seeking exposure to international shares.
Investing in the VGS ETF involves risks such as market volatility and currency fluctuations, as the ETF is not hedged. Investors should have a higher risk tolerance when considering this investment.
The VGS ETF primarily invests in the United States, which accounts for 73.8% of its holdings. Other significant allocations include Japan, the United Kingdom, Canada, France, and Germany.
The VGS ETF distributes dividends on a quarterly basis, providing investors with regular income from their investment.
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