When markets feel shaky, it is natural for investors to question their exposure to the United States. Rising debt levels, political gridlock, inflation worries, or fears of slowing growth can all push investors to think about moving money out of the US. But while it can be tempting to flee entirely, history shows that scary moments in American markets tend to pass. The US economy has repeatedly recovered from recessions, wars, financial crises, and political turmoil. For long-term investors, the United States remains a cornerstone of wealth building.
That said, diversification is always a smart move for retail investors. If you are feeling uneasy about being too heavily concentrated in the US, one simple way to add balance to your portfolio is through VXUS, the Vanguard Total International Stock ETF.
What Is VXUS?
VXUS is an exchange-traded fund (ETF) that gives investors exposure to more than 7,000 stocks outside of the United States. It covers both developed markets, such as Europe and Japan, and emerging markets, like India and Brazil. With one purchase, you can spread your investments across thousands of companies around the world.
Unlike funds that focus narrowly on Europe, Asia, or emerging markets, VXUS offers broad global exposure. It is designed to complement a US-heavy portfolio by giving you access to growth in other regions without having to pick individual international stocks.
Why Diversify Outside of the United States?
Even though the US has historically delivered strong long-term returns, no single country stays on top forever. In the 1980s, Japan was considered an unstoppable economic force. In the 2000s, emerging markets outpaced the US. Over the last decade, US stocks dominated, thanks to the rise of big technology companies.
By investing in VXUS, you give yourself exposure to regions that may outperform in the future. International stocks also often move differently than US stocks, which helps smooth out the ups and downs in your portfolio. Diversification reduces the risk of being overexposed to a single country’s economy, politics, or currency.
How VXUS Fits in a Long-Term Portfolio
Most US investors naturally hold more domestic stocks than international ones. This is called home bias. While it is reasonable to favor the US given its strong track record, adding international exposure through VXUS can help balance the risk.
One simple approach is to make VXUS a small percentage of your portfolio while keeping the majority in US-focused funds like the S&P 500. For example, some investors aim for an allocation of 70 percent US stocks and 30 percent international stocks. This keeps the US as the core while still giving you access to global growth.
It is worth noting that international markets often trade at lower valuations than the US. This means you might be buying stocks abroad at cheaper prices, potentially setting yourself up for higher returns if those markets rebound.
Don’t Panic, Stay Invested
The most important principle for long-term investors is to stay invested. So before you sell all of your US based investments, you should know that pulling out of the market during times of fear has historically been a losing strategy. While it may feel reassuring to shift everything away from the US during uncertain times, history suggests that patience pays off.
Adding VXUS is not about abandoning American markets. It is about building a resilient portfolio that can withstand whatever the future brings. By balancing your US exposure with global diversification, you can protect your wealth while still participating in long-term growth.
Winchell House 
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