Is Vident International Equity Strategy ETF (VIDI) a Strong ETF Right Now?

Launched on 10/29/2013, the Vident International Equity Strategy ETF (VIDI) is a smart beta exchange traded fund offering broad exposure to the Foreign Large Value ETF category of the market.

What Are Smart Beta ETFs?

The ETF industry has traditionally been dominated by products based on market capitalization weighted indexes that are designed to represent the market or a particular segment of the market.

Because market cap weighted indexes provide a low-cost, convenient, and transparent way of replicating market returns, they work well for investors who believe in market efficiency.

On the other hand, some investors who believe that it is possible to beat the market by superior stock selection opt to invest in another class of funds that track non-cap weighted strategies--popularly known as smart beta.

These indexes attempt to select stocks that have better chances of risk-return performance, based on certain fundamental characteristics or a combination of such characteristics.

Methodologies like equal-weighting, one of the simplest options out there, fundamental weighting, and volatility/momentum based weighting are all choices offered to investors in this space, but not all of them can deliver superior returns.

Fund Sponsor & Index

Managed by Vident Financial, VIDI has amassed assets over $356.31 million, making it one of the average sized ETFs in the Foreign Large Value ETF. Before fees and expenses, VIDI seeks to match the performance of the Vident International Equity Index.

The Vident Core International Equity Index is an international equity index that combines principles-based country and securities selection with sophisticated risk management. The index balances risk across developed and emerging economies and emphasizes those with favorable conditions for growth.

Cost & Other Expenses

Investors should also pay attention to an ETF's expense ratio. Lower cost products will produce better results than those with a higher cost, assuming all other metrics remain the same.

Operating expenses on an annual basis are 0.61% for this ETF, which makes it one of the more expensive products in the space.

It's 12-month trailing dividend yield comes in at 4.32%.

Sector Exposure and Top Holdings

It is important to delve into an ETF's holdings before investing despite the many upsides to these kinds of funds like diversified exposure, which minimizes single stock risk. And, most ETFs are very transparent products that disclose their holdings on a daily basis.

When you look at individual holdings, Cash & Other (Cash&Other) accounts for about 0.88% of the fund's total assets, followed by Heidelberg Materials Ag (HEI) and Cencosud Sa (CENCOSUD).

VIDI's top 10 holdings account for about 6.75% of its total assets under management.

Performance and Risk

So far this year, VIDI has added about 14.67%, and is up roughly 13.19% in the last one year (as of 05/20/2025). During this past 52-week period, the fund has traded between $23.03 and $28.52.

The ETF has a beta of 0.79 and standard deviation of 16.31% for the trailing three-year period, making it a medium risk choice in the space. With about 259 holdings, it effectively diversifies company-specific risk.

Alternatives

Vident International Equity Strategy ETF is a reasonable option for investors seeking to outperform the Foreign Large Value ETF segment of the market. However, there are other ETFs in the space which investors could consider.

Dimensional International Value ETF (DFIV) tracks ---------------------------------------- and the Schwab Fundamental International Equity ETF (FNDF) tracks Russell RAFI Developed ex US Large Co. Index (Net). Dimensional International Value ETF has $11.36 billion in assets, Schwab Fundamental International Equity ETF has $15.70 billion. DFIV has an expense ratio of 0.27% and FNDF charges 0.25%.

Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the Foreign Large Value ETF.

Bottom Line

To learn more about this product and other ETFs, screen for products that match your investment objectives and read articles on latest developments in the ETF investing universe, please visit Zacks ETF Center.

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This article originally published on Zacks Investment Research (zacks.com).

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