International equity funds came back in vogue in the first quarter of 2025. This came as a surprise to many investors, who entered the year positioned for further American excellence given the political rhetoric that won President Trump his second term. Instead, we have seen domestic equities fall out of the top position in our broad asset class rankings over the past month. That was not on the average investor’s bingo card when we ended 2024.

Meanwhile, the broad developed market ex-US ETF EFA is currently besting the S&P 500 Index SPX by over 17% (through 5/7), which would mark the widest annual dispersion favoring EFA since 1993. We obviously have a while before the end of the year, but foreign stocks have made their mark by trending higher throughout the past quarter.

Momentum investing is defined by trends. At the end of the day, all momentum investing seeks to do is follow the areas with the best trends and avoid areas with the weakest trends. That approach works best in markets with high dispersion. If everything is trending in the same direction, it is difficult for the momentum factor to add much value. Strong markets for momentum investing are those with big winners and big losers, which we often seen within international equities.

The benefits of applying momentum to international equity exposure can be seen through a historical performance review of the Invesco Nasdaq Dorsey Wright Developed Markets Momentum ETF (PIZ) and EFA. Comparing the annual performance of each fund since 2002 shows that PIZ has outpaced EFA in 18 out of the past 24 years. Starting a hypothetical investment at the end of 2001 would have produced a cumulative return of 407.02% for those invested in PIZ, compared to 120.33% for those invested in EFA.

The Invesco Dorsey Wright Developed Markets Momentum ETF (PIZ) also presents a robust current technical on its default point & figure chart. The fund saw consolidation alongside the risk-off movement across global equities in early April, moving lower to test its positive trend line at $34.50. Since then, PIZ roared back to a buy signal in April before reaching the current chart position at $42.50. The fund carries a strong 5.94 fund score (out of 6 possible points), besting the average non-US equity fund (3.90). We also saw PIZ move to a relative strength buy signal against the market in March  for the first time since early 2021. The long-term technical picture has seen favorable changes over the last few months, and the near-term picture has flipped back to positive momentum over the last few weeks. The fund is actionable at the current level, or upon a potential pullback toward the middle of its trading band near $39. Initial support can be seen at $36/50, with the potential for support also seen at prior resistance at $40.

The latest technical characteristics of the 30 NDW ETPs can be found below, as of 5/9/2025.