Vanguard Total International Stock ETF (VXUS 1.53%) and iShares Core MSCI EAFE ETF (IEFA 1.32%) both offer broad international equity exposure, but VXUS includes emerging markets while IEFA sticks to developed markets and comes with a marginally higher yield and lower volatility.
Both VXUS and IEFA are popular options for adding non-U.S. equities to a portfolio, but they differ in coverage, risk profile, and sector makeup. This comparison highlights how VXUS's inclusion of emerging markets contrasts with IEFA's focus on developed economies, and examines where each fund may fit for investors seeking global diversification.
Snapshot (cost & size)
| Metric | VXUS | IEFA |
|---|---|---|
| Issuer | Vanguard | IShares |
| Expense ratio | 0.05% | 0.07% |
| 1-yr return (as of Jan. 30, 2026) | 29.5% | 26.6% |
| Dividend yield | 3.1% | 3.5% |
| Beta | 1.00 | 0.73 |
| AUM | $573.7 billion | $162.6 billion |
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 slightly more affordable with a 0.05% expense ratio compared to IEFA's 0.07%, while IEFA pays a marginally higher dividend yield, which may appeal to income-focused investors.
NYSEMKT: IEFA
Key Data Points
Performance & risk comparison
| Metric | VXUS | IEFA |
|---|---|---|
| Max drawdown (5 y) | -29.43% | -30.41% |
| Growth of $1,000 over 5 years | $1,297 | $1,353 |
NASDAQ: VXUS
Key Data Points
What's inside
IEFA holds 2,589 stocks from developed markets outside the U.S. and Canada, with financial services (22%), industrials (20%), and healthcare (11%) as its largest sectors. Its top positions include ASML, Roche, and HSBC, and the fund has a track record of 13.3 years. IEFA does not carry any leverage, ESG, or currency quirks.
VXUS, by comparison, holds over 8,600 stocks spanning both developed and emerging markets, with greater exposure to financial services, industrials, and technology. Its largest positions are Taiwan Semiconductor Manufacturing, Tencent, and ASML. This broader reach means VXUS includes markets and companies not found in IEFA, potentially adding diversification but also some additional volatility.
What this means for investors
International stocks surged over 30% in 2025, outpacing U.S. markets by double digits thanks to a weaker dollar and attractive valuations abroad. Both VXUS and IEFA captured these gains, but VXUS casts a much wider net while IEFA stays selective about which international markets it touches.
VXUS owns a massive 8,600+ stocks across both developed economies like Europe and Japan and emerging markets like China and India, splitting roughly 75/25 between mature and developing markets. This one-ticket approach means you get European stability, Asian technology innovation, and emerging market growth potential in a single fund at rock-bottom cost. IEFA narrows its 2,600 holdings to developed markets only—specifically Europe, Australasia, and the Far East. It deliberately excludes emerging economies, trading away their higher growth potential to avoid the political instability, currency volatility, and regulatory unpredictability that comes with developing markets.
VXUS is the better choice for investors building a complete international allocation who want exposure to the world's fastest-growing economies. IEFA suits conservative investors who prefer the predictability of established markets and want to avoid emerging market turbulence, even if it means sacrificing potential outperformance when developing economies surge.
For more guidance on ETF investing, check out the full guide at this link.
