iShares Core MSCI EAFE ETF

IEFA

Market cap $186B

The iShares Core MSCI EAFE ETF (IEFA) invests only in developed market stocks outside of the United States and Canada. The Vanguard Total International Stock ETF (VXUS) offers more comprehensive global coverage across both developed and emerging markets.

The iShares Core MSCI EAFE ETF (NYSEARCA:IEFA) has quietly become one of the best-performing core holdings in U.S.

Developed international equity ETFs are presenting unique diversification challenges for investors this summer. In light of ongoing UK political developments, selecting the correct international vehicle requires a granular look at geographic exposures.

If you've only invested in U.S. equities in the past two decades, you've likely won big, at least compared to non-U.S.

iShares Core MSCI EAFE ETF offers a much lower expense ratio of 0.07% compared to the 0.72% fee for iShares MSCI Emerging Markets ETF. iShares Core MSCI EAFE ETF provides a higher trailing-12-month dividend yield of 3.30% while focusing on developed markets.

State Street SPDR Portfolio MSCI Global Stock Market ETF provides broad exposure to U.S. and emerging markets while iShares Core MSCI EAFE ETF focuses strictly on developed international stocks The iShares fund offers a significantly higher dividend yield and lower expense ratio than the State Street alternative State Street SPDR Portfolio MSCI Global Stock Market ETF has delivered higher total returns and lower maximum drawdown over the last five years

Vanguard FTSE Developed Markets ETF includes Canadian equities and maintains a lower expense ratio of 0.03%. iShares Core MSCI EAFE ETF excludes North American exposure entirely and currently provides a higher trailing-12-month dividend yield.

The developed market rate-hiking club is getting bigger, as the European Central Bank on Thursday joined counterparts in Australia, Norway and Japan in tightening monetary policy, while more central banks are set ​to follow in the coming months.

The iShares Core MSCI Total International Stock ETF has outperformed the S&P 500 index in the past year (as of June 7). The iShares Core MSCI EAFE ETF has delivered a trailing 12-month dividend yield of 3.30%.

The Vanguard Total International Stock ETF (VXUS) buys virtually every investable stock outside of the U.S. The iShares Core MSCI EAFE ETF (IEFA) invests only in developed-market stocks outside the U.S. and Canada. While that's been a performance differentiator, I'd rather have the more comprehensive ETF in my portfolio.