Q: This ETF share price is sitting at a pretty lofty all time high. Looking at its history, after a run up, it has always had a substantial pull back. Can you comment on the factors you think have led to its current level and whether you think it is still investable here? Thank you.
5i Research Answer:
International markets have long been much cheaper than North American markets. This year, with tariff news and concern on the US in general, there was a giant sentiment shift, and also, partly, an 'avoid the US' mentality. International markets are much less liquid, and we saw a wave of new money suddenly shift locations. The shift has closed the valuation gap, but the US is still more expensive. International markets are also highly sensitive to US rates, the US dollar and inflation. These have all moved in a positive direction for the regions in the past year. We continue to believe in diversification. VEE will likely remain volatile, but we would still consider it very investable.