This is a rules-based ETF that allocates weights across developed and emerging market stocks outside the US by evaluating both each country's economic and financial health and each company's fundamentals. It diversifies across overseas stocks using rules that differ from market-cap weighting.

It suits investors who want to diversify across overseas developed and emerging market stocks using a rules-based approach that differs from market-cap weighting.

It is a passively managed (index-tracking) ETF run by Vident.

The ETF follows a rules-based strategy that scores each country's economic and financial health along with each company's fundamentals, then allocates weights accordingly. It reduces the concentration in particular countries and stocks that arises under simple market-cap weighting, and diversifies across overseas stocks based on health criteria.

• Weighting based on country and company financial health
• Overseas diversification with less market-cap concentration

Assets under management (AUM) stand at $435.9M, and the total expense ratio is 0.61% per year.

Compared with the overseas fundamental and factor ETFs FNDF and GSIE, the main points of comparison are the country and company health assessment method and the holdings composition.

Overseas stocks move with global risk appetite, the strength of the dollar, economic conditions in each country, and style rotation. Because of its health-based criteria, a rules-based weighting strategy can differ from market-cap indexes in country and stock composition. Volatility may be somewhat higher depending on the emerging market weighting.

Fund flows into rules-based overseas equities vary with global risk appetite, exchange rate trends, and style rotation, and money sometimes shifts toward related products when interest in diversification and financial health rises. It is also worth noting that performance can differ depending on each country's economy and currency variables.

Diversification based on country and company financial health is its strength, while tracking differences versus market-cap indexes, emerging market volatility, and exchange rates are considerations.

For broader exposure to overseas developed markets, direct substitutes include EFA and VEA, and for wider exposure to global stocks outside the US, products such as ACWX are also worth comparing. The three products shown in the table, FNDF, GSIE, and IGF, differ in selection criteria and exposure, covering overseas fundamental and factor stocks and global infrastructure respectively. This ETF's distinguishing criterion is rules-based overseas diversification that weights holdings by assessing country and company financial health.

Here are the points to review before investing in VIDI. Health-based diversification is appealing, but tracking differences, emerging market volatility, and exchange rates should be checked in advance. It is also wise to compare it with broad overseas and fundamental products.

Tracking differences from health-based weighting, emerging market volatility, and exchange rate moves are the main variables for long-term performance, and a rules-based strategy can diverge from the market average depending on the period. With a large overseas and emerging market weighting, currency and regional risks may also come into play.

It is a suitable candidate for investors who want to diversify across overseas stocks using a rules-based approach that differs from market-cap weighting. If broad market-cap-weighted overseas exposure is the priority, products like EFA and VEA are worth considering, while investors who want diversification based on country and company financial health should compare this product alongside them before choosing.