VXUS Offers Broader Global Exposure Than IEFA

Core Insights - The Vanguard Total International Stock ETF (VXUS) includes emerging markets, while the iShares Core MSCI EAFE ETF (IEFA) focuses solely on developed markets outside the U.S. and Canada [1][2] Cost & Size Comparison - VXUS has an expense ratio of 0.05% and assets under management (AUM) of $606 billion, while IEFA has a slightly higher expense ratio of 0.07% and AUM of $178 billion [3][4] - The 1-year return for VXUS is 35.7%, compared to IEFA's 32.9%, and the dividend yield for VXUS is 2.91%, while IEFA offers a higher yield of 3.27% [3][4] Performance & Risk Analysis - Over the past five years, VXUS experienced a maximum drawdown of 29.44%, while IEFA had a slightly higher drawdown of 30.37% [5] - An investment of $1,000 would have grown to $1,504 in VXUS and $1,580 in IEFA over the same period [5] Portfolio Composition - VXUS holds 8,691 stocks, with significant positions in Taiwan Semiconductor Manufacturing Co Ltd, Tencent Holdings Ltd, and ASML Holding NV, providing geographic diversification with 38% in Europe, 27% in emerging markets, 25% in the Pacific, and 8% in North America [6] - IEFA contains 2,589 developed-market stocks, with major holdings in ASML Holding NV, Roche Holding AG, and AstraZeneca Plc, offering a stable composition for investors avoiding emerging-market risks [7] Investment Implications - Both ETFs are low-cost options for gaining international stock exposure, with improving global economic conditions and a weaker dollar potentially driving growth in international stocks in 2026 [8] - IEFA may be more suitable for the current bull market due to its recent outperformance and higher dividend yield, along with its focus on economically stable developed markets [8][9]