Global Equity ETFs for Uncertain Markets
Global equity ETFs offer diversified exposure across regions, helping investors stay invested and resilient through periods of market volatility.
The phrase ‘history doesn’t repeat, but it does rhyme’ is often used to describe the cyclical similarities in market events over time. As the global economy grapples with the ramifications of the Iran Conflict and its impact on energy markets, the current uncertainty is somewhat reminiscent of April 2025, when President Trump announced a broad range of reciprocal tariffs (i.e., Liberation Day), which catalyzed global economic uncertainty.
While the source of the current uncertainty (i.e., War/Energy Scarcity) differs markedly from last year's (i.e., Trade Policy/Protectionism), the market's response, as reflected in the depth of the drawdown, is noteworthy. Looking at the MSCI USA Index, the market’s decline began in mid-February 2025, aligning with President Trump’s initial political posturing about the U.S.’s unfair trade agreements. However, Liberation Day marked a seismic shift, triggering an abrupt drop. Conversely, the unexpected attack on Iran and the Iranian military’s response to close the Strait of Hormuz have shaken U.S. markets, albeit to a lesser degree than the impact of Trump’s tariff policy enactments.
Broadening the scope of comparison to international markets, the impact of liberation day was relatively short-lived, as reflected in the MSCI ACWI Ex USA Index's comparatively quick recovery. However, the current crisis appears to have a more prolonged impact on international markets, given the high dependence of European and Asian economies on Middle Eastern oil.
Staying Invested Across Mark Cycles
Another investment truism that comes to mind as we navigate this market environment is to stay invested. Undoubtedly, over a long investment cycle, investors will experience downturns; however, once they end, they ultimately benefit from the rebound. Looking at the performance of both the MSCI USA Index and the MSCI ACWI ex USA Index from their lowest point in April 2025 to the present (i.e., April 10th, 2026), the returns have been meaningful.
Another seminal takeaway is the importance of diversification. The impact of a market event varies across asset classes and regions; as such, being broadly diversified makes investors less susceptible to a market downturn in any one investment space while also allowing them to participate in and benefit from growth in other areas. Year-to-date, the MSCI ACWI Ex USA and MSCI ACWI have outperformed the MSCI USA. While new market dynamics may arise within the year that could ultimately shift the prevailing performance leadership, in principle, having broad equity market diversification has proven beneficial to investors over a long investment time horizon.
Gaining Global Equity Exposure via ETFs
For investors seeking global equity exposure in a turnkey manner, the iShares Core Equity ETF Portfolio (Ticker: XEQT), Fidelity All-in-One Equity (Ticker: FEQT), and Vanguard All-Equity ETF Portfolio (Ticker: VEQT) provide diversified equity exposure through single-ticket solutions.
XEQT seeks to provide long-term capital growth by investing primarily in one or more exchange-traded funds managed by BlackRock Canada and is managed in accordance with a long-term strategic asset allocation; the current target weight for each asset class is 25% Canadian equities, 45% U.S. equities, and 25% International Developed Market equities.
FEQT follows a neutral mix guideline of approximately 97% global equity securities and approximately 3% cryptocurrencies. The portfolio will be rebalanced annually. Additionally, if the portfolio deviates from its neutral mix by more than 5% between annual rebalances, the portfolio will also be rebalanced.
VEQT seeks long-term capital growth by primarily investing in equity securities. The sub-advisor will strive to maintain a long-term strategic asset allocation of 100% equity securities. The portfolio asset mix may be reconstituted and rebalanced from time to time at the sub-advisor's discretion.
Additionally, if there are Canadian investors seeking globally focused solutions that also exclude U.S. equity exposure, the Vanguard FTSE Developed All Cap ex U.S. Index ETF (Ticker: VDU) seeks to track the FTSE Developed All Cap ex US Index; investing primarily in large-, mid-, and small-capitalization stocks of companies located in developed markets, excluding the U.S. As a point of emphasis and differentiation, VDU is not a fund-of-funds offering like the previously mentioned solutions.
This article was written on April 12th, 2026. Please note this article is for information purposes only and does not in any way constitute investment advice. It is essential that you seek advice from a registered financial professional prior to making any investment decision.
