Rather than replicating a specific index, this actively managed international equity ETF selects and concentrates its holdings in non-US listed companies whose long-term earnings drivers the managers believe are undervalued. It holds developed and emerging markets together.

It suits investors who want to diversify outside the US but would rather rely on the managers' stock selection than on index tracking.

It is an ETF run by Nomura using an active (actively managed) approach.

The fund invests most of its net assets in common stocks of companies located in, or doing business in, regions outside the US. Instead of broadly holding index constituents, it narrows the portfolio to a small number of high-conviction stocks, concentrating exposure on long-term earnings drivers that it believes the market has not yet priced in.

• A concentrated portfolio rather than a broad index replica
• Developed and emerging markets combined in a single product
• Ad hoc weight adjustments at the managers' discretion

Assets under management (AUM) stand at $90.1M, and the total expense ratio (Expense Ratio) is 0.59% per year.

The fee burden is heavier than for core international index ETFs, but the structure aims to earn excess returns through stock selection.

The fund broadly follows the trend of the international equity category, but because of its concentrated portfolio, moves in individual large holdings tend to weigh heavily on performance. Performance dispersion can be wider than for index-tracking products.

Fund flows in the international equity category ebb and flow with the strength of the dollar and valuation levels outside the US. However, this ETF is a small player within its category, so liquidity and bid-ask spreads may be less favorable than for core products.

Its strength is the potential for excess returns through stock selection, while its fees and the liquidity concerns that come with its small size are the burdens.

The three products shown in the table, VEA, IEFA, and VXUS, are low-cost core products that broadly cover non-US markets through indexes, and EFA and VT are also natural comparisons along the same international diversification axis. Unlike these, this ETF uses concentrated active management, so its character differs. Beyond the table, you can also consider SCHF and SPDW as developed market core holdings, IXUS for total non-US market exposure, and EFG and EFV as style variants.

These are the items to review before investing in this ETF. Because it is a concentrated active fund, the points to verify differ from those for core index products, and it is wise to weigh costs, stock concentration, and trading conditions together.

Because of its concentrated structure, individual company risk passes directly into performance, and the emerging market portion is more exposed to political and currency variables. If the managers' judgment misses, underperformance versus index products could persist for a long time.

A reasonable setup is to fill the international core with low-cost index products and add this ETF in a supplementary slot aimed at excess returns. First confirm that you can tolerate its costs and concentration.