Rethinking Home Country Bias
October 08, 2026
Read Time 4 MIN
Key Takeaways
- U.S. advisors still hold an average 79% of equity exposure at home.
- 45% of advisors plan to increase equity allocations outside the U.S. market over the next two years; only 4% plan to decrease.
- Advisors want more than plain beta abroad. Preference for active management in EM (52%) runs well ahead of current active EM ETF use (35%).
Source: MSCI, 2026 ETF Intelligence Report, as of September 2026.
Is Home Country Bias Is Starting to Crack?
MSCI's 2026 ETF Intelligence Report, a survey of 450 advisors and investment decision-makers across the U.S. and Europe, arrives at a moment when U.S. investors have been rewarded for staying home for most of the last decade. The survey suggests that posture is loosening. Just over half of respondents expect their international equity allocation to hold steady, but among those planning a change, the direction is almost entirely outward: 45% plan to increase, 4% plan to decrease.
U.S. respondents allocate an average of 79% of equity exposure to their home market, more than double the 32% reported by European respondents. Even so, 47% of U.S. advisors plan to increase international exposure over the next two years. International markets have lagged the U.S. for a long time, and that trend is showing signs of a reversal.
The report also shows where the biggest room to move sits. Respondents overseeing $1 billion or more already allocate an average of 65% of equity exposure outside their home market, compared with 48% among those overseeing less than $1 billion. Smaller practices, in other words, have the furthest distance to travel and the most to gain from efficient, low-friction vehicles for getting there.
Emerging Markets Are the Destination, And Advisors Want A Smarter Route
When advisors look abroad, they lean toward emerging markets. 39% expect greater EM focus over the next two years, compared with 24% who expect greater focus on developed markets, and 32% want more EM ETF choice.
But the report also surfaces a gap. Advisors say they prefer active management for EM exposure (52% overall, 63% in the U.S.), yet only 35% currently use active EM ETFs. Read plainly: advisors want something beyond market-cap beta in EM, and the current shelf is not fully meeting that demand.
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Developed markets Still Matter, Especially for U.S. Advisors
The EM tilt is strongest in Europe, where 50% of respondents expect greater EM focus. U.S. advisors, on the other hand, are more likely to expect an equal focus across developed and emerging markets. For a U.S. advisor whose international sleeve has been thin, the first step is often not an EM bet but a broader rebuild that covers Japan, the U.K., Europe and Australia alongside the emerging world.
Where VEFA and VEEM fit
This is the gap the VanEck MSCI EAFE Analyst Sentiment ETF (VEFA) and the VanEck MSCI EM Analyst Sentiment ETF (VEEM) were designed to address, individually or as a pair.
Both funds track MSCI Analyst Sentiment Select Indexes, which start from the familiar MSCI EAFE and MSCI Emerging Markets universes and then systematically tilt toward companies where professional analysts are revising estimates upward. The idea is to capture a forward-looking fundamental signal, the kind of input an active manager would weigh, in a rules-based, transparent index that is designed to limit tracking error against its parent benchmark. VEFA covers developed markets outside the U.S. and Canada; VEEM covers emerging markets. Together they map to the balanced developed-and-emerging approach U.S. advisors say they want.
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The Bottom Line
The report's conclusion is that the next phase of ETF growth will be defined by fit: the structure suiting the strategy, the cost reflecting the value of the exposure, and the benchmark providing real context. For advisors moving capital abroad and looking for a systematic way to do more than own the index, VEFA and VEEM were built with exactly that fit in mind.
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Important Disclosures
This is not an offer to buy or sell, or a recommendation to buy or sell any of the securities, financial instruments or digital assets mentioned herein. The information presented does not involve the rendering of personalized investment, financial, legal, tax advice, or any call to action. Certain statements contained herein may constitute projections, forecasts and other forward-looking statements, which do not reflect actual results, are for illustrative purposes only, are valid as of the date of this communication, and are subject to change without notice. Actual future performance of any assets or industries mentioned are unknown. Information provided by third party sources are believed to be reliable and have not been independently verified for accuracy or completeness and cannot be guaranteed. VanEck does not guarantee the accuracy of third party data. The information herein represents the opinion of the author(s), but not necessarily those of VanEck or its other employees.
MSCI EAFE Index: The MSCI EAFE Index is an equity index which captures large and mid cap representation across 21 Developed Markets countries around the world, excluding the US and Canada. With 694 constituents, the index covers approximately 85% of the free float-adjusted market capitalization in each country.
MSCI EAFE Analyst Sentiment Select Index: MSCI EAFE Analyst Sentiment Select Index is based on MSCI EAFE Index, its parent index which includes large and mid-cap stocks across 21 Developed Markets countries around the world, excluding the US and Canada. The index uses an optimization process that aims to maximize the exposure to the Analyst Sentiment factor, while controlling for active risk, active specific risk and net ex-ante beta relative to the parent index.
MSCI Emerging Markets Index: The MSCI Emerging Markets Index captures large- and mid-cap representation across 24 Emerging Markets countries. With over 1,200 constituents, the index covers approximately 85% of the free float-adjusted market capitalization in each country.
Index returns are not Fund returns and do not reflect any management fees or brokerage expenses. Certain indices may take into account withholding taxes. Investors can not invest directly in the Index. Returns for actual Fund investors may differ from what is shown because of differences in timing, the amount invested and fees and expenses. Index returns assume that dividends have been reinvested.
An investment in the VanEck MSCI EM Analyst Sentiment ETF (VEEM) and VanEck MSCI EAFE Analyst Sentiment ETF (VEFA) may be subject to risks which include, but are not limited to, risks related to investments in emerging market issuers, foreign securities, foreign currency, information technology sector, financials sector, basic materials sector, industrials sector, health care sector, special risk considerations of investing in Chinese, European, Indian, Japanese, South Korean, Taiwanese and United Kingdom issuers, cash transactions, depositary receipts, equity securities, issuer-specific changes, medium- and large-capitalization companies, market, operational, index tracking, authorized participant concentration, new fund, no guarantee of active trading market, trading issues, passive management, fund shares trading, premium/discount, liquidity of fund shares, non-diversified, and index-related concentration risks, all of which may adversely affect the Funds. Emerging market issuers and foreign securities may be subject to securities markets, political and economic, investment and repatriation restrictions, different rules and regulations, less publicly available financial information, foreign currency and exchange rates, operational and settlement, and corporate and securities laws risks. Investments in Chinese issuers may entail additional risks that include, among others, lack of liquidity and price volatility, currency devaluations and exchange rate fluctuations, intervention by the Chinese government, nationalization or expropriation, limitations on the use of brokers, and trade limitations. Medium- and large-capitalization companies may be subject to elevated risks.
Investing involves substantial risk and high volatility, including possible loss of principal. An investor should consider the investment objective, risks, charges and expenses of a Fund carefully before investing. To obtain a prospectus and summary prospectus, which contain this and other information, call 800.826.2333 or visit vaneck.com. Please read the prospectus and summary prospectus carefully before investing.
© Van Eck Securities Corporation, Distributor, a wholly owned subsidiary of Van Eck Associates Corporation.
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Important Disclosures
This is not an offer to buy or sell, or a recommendation to buy or sell any of the securities, financial instruments or digital assets mentioned herein. The information presented does not involve the rendering of personalized investment, financial, legal, tax advice, or any call to action. Certain statements contained herein may constitute projections, forecasts and other forward-looking statements, which do not reflect actual results, are for illustrative purposes only, are valid as of the date of this communication, and are subject to change without notice. Actual future performance of any assets or industries mentioned are unknown. Information provided by third party sources are believed to be reliable and have not been independently verified for accuracy or completeness and cannot be guaranteed. VanEck does not guarantee the accuracy of third party data. The information herein represents the opinion of the author(s), but not necessarily those of VanEck or its other employees.
MSCI EAFE Index: The MSCI EAFE Index is an equity index which captures large and mid cap representation across 21 Developed Markets countries around the world, excluding the US and Canada. With 694 constituents, the index covers approximately 85% of the free float-adjusted market capitalization in each country.
MSCI EAFE Analyst Sentiment Select Index: MSCI EAFE Analyst Sentiment Select Index is based on MSCI EAFE Index, its parent index which includes large and mid-cap stocks across 21 Developed Markets countries around the world, excluding the US and Canada. The index uses an optimization process that aims to maximize the exposure to the Analyst Sentiment factor, while controlling for active risk, active specific risk and net ex-ante beta relative to the parent index.
MSCI Emerging Markets Index: The MSCI Emerging Markets Index captures large- and mid-cap representation across 24 Emerging Markets countries. With over 1,200 constituents, the index covers approximately 85% of the free float-adjusted market capitalization in each country.
Index returns are not Fund returns and do not reflect any management fees or brokerage expenses. Certain indices may take into account withholding taxes. Investors can not invest directly in the Index. Returns for actual Fund investors may differ from what is shown because of differences in timing, the amount invested and fees and expenses. Index returns assume that dividends have been reinvested.
An investment in the VanEck MSCI EM Analyst Sentiment ETF (VEEM) and VanEck MSCI EAFE Analyst Sentiment ETF (VEFA) may be subject to risks which include, but are not limited to, risks related to investments in emerging market issuers, foreign securities, foreign currency, information technology sector, financials sector, basic materials sector, industrials sector, health care sector, special risk considerations of investing in Chinese, European, Indian, Japanese, South Korean, Taiwanese and United Kingdom issuers, cash transactions, depositary receipts, equity securities, issuer-specific changes, medium- and large-capitalization companies, market, operational, index tracking, authorized participant concentration, new fund, no guarantee of active trading market, trading issues, passive management, fund shares trading, premium/discount, liquidity of fund shares, non-diversified, and index-related concentration risks, all of which may adversely affect the Funds. Emerging market issuers and foreign securities may be subject to securities markets, political and economic, investment and repatriation restrictions, different rules and regulations, less publicly available financial information, foreign currency and exchange rates, operational and settlement, and corporate and securities laws risks. Investments in Chinese issuers may entail additional risks that include, among others, lack of liquidity and price volatility, currency devaluations and exchange rate fluctuations, intervention by the Chinese government, nationalization or expropriation, limitations on the use of brokers, and trade limitations. Medium- and large-capitalization companies may be subject to elevated risks.
Investing involves substantial risk and high volatility, including possible loss of principal. An investor should consider the investment objective, risks, charges and expenses of a Fund carefully before investing. To obtain a prospectus and summary prospectus, which contain this and other information, call 800.826.2333 or visit vaneck.com. Please read the prospectus and summary prospectus carefully before investing.
© Van Eck Securities Corporation, Distributor, a wholly owned subsidiary of Van Eck Associates Corporation.