AVNM provides factor-tilted exposure to international developed and emerging markets in a single fund, targeting companies with stronger profitability metrics and lower valuations than the broad market. It's Avantis's answer to investors wanting their systematic value approach applied globally outside the US.
How It Works
The fund starts with a broad international universe then systematically overweights stocks showing high profitability (measured by operating income to book value) and attractive valuations relative to their fundamentals. Unlike pure index funds, portfolio managers can make modest adjustments to improve tax efficiency and reduce trading costs. The methodology favors profitable value stocks while maintaining broad diversification across both developed and emerging markets.
Key Features
- Combines developed and emerging markets with ~15-20% EM weight vs separate fund hassle
- Active implementation of systematic factors keeps costs down through flexible trading
- Higher profitability tilt than typical value funds — avoiding value traps
Risks
- Factor tilts can underperform for years — value has lagged growth by 20%+ in past decade
- Emerging market exposure adds 30-40% more volatility than developed-only funds
- Currency risk from unhedged international exposure can swing returns ±10% annually
Who Should Own This
Best for investors who believe in factor premiums but want simplicity — one fund instead of juggling separate international developed and emerging allocations. Works well for those comfortable with Avantis's systematic value approach who want to apply it globally. Not for investors needing to control their exact geographic weights or those who prefer market-cap weighting.