Vanguard Total International Stock ETF (VXUS +0.05%) and iShares MSCI ACWI ex US ETF (ACWX 0.06%) both offer broad non-U.S. equity exposure, but VXUS is significantly cheaper, holds far more stocks, and tilts less toward financials and technology than ACWX.

Both funds aim to deliver diversified access to international equities, targeting developed and emerging markets outside the United States. This comparison explores how their costs, holdings, sector tilts, and recent performance may matter for investors seeking global diversification.

Snapshot (Cost & Size)

Beta measures price volatility relative to the S&P 500; beta is calculated from five-year weekly returns. The 1-yr return represents total return over the trailing 12 months.

VXUS is considerably more affordable with an expense ratio of 0.05%, while ACWX charges 0.32%. VXUS also provides a higher dividend yield at 3.1% compared to ACWX’s 2.7% payout.

Performance & Risk Comparison

What's Inside

ACWX tracks large- and mid-cap companies outside the U.S. and currently holds 1,751 stocks. ACWX has a fund age of 17.8 years. It is most heavily weighted toward financial services (25%), technology (15%), and industrials (15%). Its top holdings include Taiwan Semiconductor Manufacturing, Tencent Holdings Ltd, and Asml Holding Nv, collectively making up a notable share of assets.

VXUS, by contrast, is broader, holding 8,602 stocks across developed and emerging markets, and currently leans heavily into cash and others (53%), with smaller slices in industrials and technology. Its largest positions—Taiwan Semiconductor Manufacturing Co Ltd, Tencent Holdings Ltd, and ASML Holding NV—mirror ACWX’s, but make up a smaller portion of the portfolio, resulting in less concentration risk. Neither fund employs leverage, hedging, or ESG screens.

For more guidance on ETF investing, check out the full guide at this link.

What This Means For Investors

The U.S. stock market is the largest and most influential around. However, investors would do well to remember that it is not all the world has to offer. There are many dynamic foreign-based companies listed on stock markets outside of the U.S. worth considering. For those who are looking to gain international exposure, there are plenty of ETFs to choose from, including Vanguard Total International Stock ETF (VXUS) and iShares MSCI ACWI ex US ETF (ACWX). Here's what investors should know about them.

First, let's cover the funds' similarities. Both VXUS and ACWX overlap in terms of top holdings, including ASML, Tencent, and TSM. In addition, both share a similar performance history. Over the last five years, VXUS has generated a total return of 48.3%, while ACWX has generated a total return of 46.4%. Similarly, the max drawdown for each fund is nearly identical at approximately -30%. Finally, both funds have a beta of 0.79 -- indicating they are somewhat less volatile compared to the S&P 500.

Turning to differences, VXUS comes out ahead on several key factors. For one, its expense ratio is 0.05%, which is very attractive. ACWX, by contrast, has an expense ratio of 0.32%, which is far closer to the industry average. As for yield, VXUS is once again superior, with a dividend yield of 3.1%, which bests ACWX's 2.7% dividend yield.

In sum, VXUS appears to be a cut above ACWX at this point. Its lower fees and higher dividend yield along with nearly identical performance, mean VXUS appears to be the preferable choice for investors seeking international exposure.

Glossary

ETF: Exchange-traded fund that holds a basket of securities and trades on an exchange like a stock.
Expense ratio: Annual fund operating costs expressed as a percentage of the fund’s average assets.
Dividend yield: Annual dividends paid by a fund divided by its current share price, shown as a percentage.
Beta: Measure of a fund’s volatility compared with a benchmark index, usually the S&P 500.
AUM: Assets under management; the total market value of all assets held in the fund.
Max drawdown: The largest peak-to-trough decline in a fund’s value over a specific period.
Total return: Investment performance including price changes plus all dividends and distributions, assuming reinvestment.
Sector allocation: How a fund’s holdings are distributed across different industries, such as technology or financials.
Emerging markets: Economies in the process of rapid growth and industrialization, generally riskier than developed markets.
Developed markets: Economies with mature financial systems, higher incomes, and stable regulatory environments.
Concentration risk: Risk that poor performance of a few large holdings significantly hurts the fund’s overall returns.
Hedging: Using financial strategies to reduce or offset potential losses from market movements.