International market diversification is gaining traction, driven by both technical and fundamental indicators for the latter half of 2026. This article offers an updated perspective on the Invesco RAFI Developed Markets ex-U.S. ETF, or PXF, building on a previous analysis from December 2025 and incorporating its latest holdings and recent performance trends.
The PXF ETF is notable for its diversified reach into developed markets outside the United States, utilizing a weighting methodology based on fundamental factors. It presents solid value characteristics and a moderate level of company-specific risk. However, investors should be aware of its significant allocation to Japanese markets and the financial sector, which could introduce concentrated risks. Despite these concentrations, PXF has shown a strong total return, outperforming the SCHF benchmark and several other key competitors. Nonetheless, the SCHF fund has maintained a lead in risk-adjusted performance since 2010 and benefits from a substantially lower expense ratio of 0.03%.
In summary, the Invesco RAFI Developed Markets ex-U.S. ETF provides a compelling option for those looking to invest in international markets through a fundamentally weighted strategy. While its past performance in terms of total return is commendable, potential investors should carefully weigh the implications of its higher fees and sector/geographic concentrations against the risk-adjusted returns offered by more cost-efficient alternatives. Investors should always consider their personal financial goals and risk tolerance when making investment decisions, striving for portfolios that are resilient and aligned with long-term growth and stability.
