IXUS vs. IEFA: Which International ETF Is Better for Most Investors?
When buying international ETFs, owning more stocks in more countries might be a better bet.
IXUS vs. IEFA: Which International ETF Is Better for Most Investors?
Overview
Buying international exchange-traded funds (ETFs) is an easy way to tap into the growth potential of stock markets beyond America. There's no guarantee that other countries' stock markets will outperform the S&P 500 index. But owning shares in international companies can be a way to protect against a downturn in U.S. tech stocks or hedge against the risk of a weaker U.S. dollar.
Two iShares ETFs offer slightly different approaches to buying global stocks, and one is more diversified than the other. The iShares Core MSCI Total International Stock ETF (NASDAQ: IXUS) offers exposure to more than 4,000 global stocks from a wide range of markets, while the iShares Core MSCI EAFE ETF (NYSEMKT: IEFA) holds about 2,600 stocks with a focus on developed markets.
Details
In the past year, the more-diversified fund (IXUS) has slightly outperformed the S&P 500, with a total return of 25.8%:
Source
Originally published at www.fool.com.
