Columbia Research Enhanced International Equity ETF (REFA)

The Columbia Research Enhanced International Equity ETF (REFA) is an actively managed fund that picks individual stocks from outside the United States—developed markets like Japan and Europe, and emerging markets like Brazil and South Korea—according to Columbia Threadneedle’s proprietary research.

This is not a passive “buy the world ex-US” index fund. REFA employs a team of analysts who sift through thousands of international companies and select perhaps 200 to 300 stocks they believe will outperform. The fund manager makes bets: overweighting markets that look cheap, underweighting ones that look expensive; buying companies with strong cash flows and balance sheets; avoiding those that feel stretched. The expense ratio reflects that active work—higher than a passive international index fund, lower than a traditional actively managed mutual fund, because the ETF wrapper keeps costs down.

Columbia Threadneedle is a British asset manager (owned by Ameriprise Financial) with deep roots in international investing. The REFA team draws on decades of regional expertise: analysts in Japan who speak Japanese and cover the local market on the ground; partners in emerging economies who understand local corporate governance; seasoned value investors who have seen multiple market cycles. The philosophy is straightforward: find good businesses that the market has temporarily mispriced, buy them at a discount, and hold until the market recognizes the value. This is traditional value investing applied globally.

The geography matters. Developed markets—Europe, Japan, Australia, Canada, the wealthy Asian tigers—are where most of REFA’s assets live. These economies have mature corporate sectors, deep capital markets, and relatively transparent accounting. Emerging markets (India, Brazil, Mexico, Thailand, Vietnam) offer higher growth potential but carry higher political and currency risk. REFA’s mix of both means you get both the stability of Nestlé or ASML alongside the upside optionality of a rapidly urbanizing country’s consumer or energy sector.

Currency exposure is a hidden consequence of holding international stocks. If you buy a British company, you earn returns in pounds; if the pound weakens against the dollar, your dollar-denominated gains shrink. REFA holds foreign currencies implicitly and does not normally hedge them away (though the specific approach can vary). That adds a second layer of volatility: the stock’s own performance plus the currency movement. In a weakening-dollar environment, international stocks can outperform; in a strengthening-dollar one, they often lag.

The active-management bet is structural. REFA’s returns depend on whether its analysts and portfolio manager can outpace a comparable international index. If they can—if their stock picks compound faster than the median international stock—then the higher expense ratio is justified and the fund is worth holding. If they cannot, you are paying extra for underperformance, which happens to many active managers over long periods. Columbia has a solid long-term track record in international value investing, but track records are not guarantees, and past outperformance does not predict future results.

Sector and country weightings shift with the manager’s views. REFA might be heavily weighted toward European banks one year and defensive healthcare the next, depending on what the research team sees. This is both the strength and the risk: the team’s conviction can generate big outperformance or big shortfalls. An investor in REFA is explicitly backing a team’s judgment about which international companies will prove undervalued, not buying a passive slice of the world.

Researching REFA means checking Columbia’s track record in international equity management over multiple decades. Look at the fund’s geographic and sector allocation: does it look appropriately balanced, or is it concentrated in a few big bets? Understand the volatility: emerging-market exposure and currency effects will create swings that a broader, more passive international fund would smooth out. Compare REFA’s returns to a simple passive international index ETF—if REFA has trailed over a full market cycle, the active management is not paying for itself. For an investor who believes in Columbia’s international research process and can tolerate active-management volatility, REFA offers the chance that international value stocks will outperform; for someone seeking simplicity and low fees, a passive global or international index fund is the cleaner choice.