Key Facts
• NISA investors heavily favor U.S. index funds like S&P 500 and “All Country.”
• Concerns grow over U.S. economic uncertainty and yen appreciation against the dollar.
• U.S.-focused funds dominate portfolios, with 60-70% of “All Country” funds in U.S. stocks.
• “Excluding U.S.” index funds offer diversification by avoiding U.S. investments entirely.
• Four “Excluding U.S.” funds are available: Rakuten VXUS, SBI V All-World (Ex-U.S.), SBI V Developed Markets (Ex-U.S.), and SBI V Global Small-Cap (Ex-U.S.).
• Rakuten VXUS and SBI V All-World (Ex-U.S.) invest broadly in developed and emerging markets.
• SBI V Developed Markets (Ex-U.S.) excludes emerging markets, ideal for risk-averse investors.
• SBI V Global Small-Cap (Ex-U.S.) targets small-cap stocks, offering higher risk and volatility.
• SBI V All-World (Ex-U.S.) launched in July 2025, while others debuted between 2022-2023.
• Trust fees are comparable, with Rakuten VXUS slightly more accessible via multiple brokers.
• “Excluding U.S.” funds limit tech sector exposure to 12-15%, enhancing diversification.
• These funds complement U.S.-focused investments like S&P 500 and “All Country.”
• Diamond Zai annually ranks NISA funds based on performance, stability, and resilience.
Summary
As NISA investors face growing concerns over U.S. economic uncertainty and yen appreciation, the risks of U.S.-centric portfolios are becoming evident. “Excluding U.S.” index funds provide a solution, offering diversification by focusing on non-U.S. markets. Four key funds-Rakuten VXUS, SBI V All-World (Ex-U.S.), SBI V Developed Markets (Ex-U.S.), and SBI V Global Small-Cap (Ex-U.S.)-cater to varying risk appetites and investment goals. These funds limit tech sector exposure, enhancing their appeal as complementary options to U.S.-focused investments like S&P 500 and “All Country.” While trust fees are similar, Rakuten VXUS is more widely available across brokers. Diamond Zai’s annual NISA rankings highlight the best-performing funds, emphasizing data-driven evaluations. For investors seeking effective diversification, “Excluding U.S.” funds are a timely and strategic choice.
