After revamping two of our choices in last year’s edition of the All-Stars, the panel decided to retain all three of our international equity picks for 2017. That includes the long-time ETF All-star XEF (iShares Core MSCI EAFE IMI Index ETF), a broadly diversified fund that helps investors who are already overweight in North American stocks move beyond this continent.
Back for the second year is XAW, iShare’s core global all-cap fund; and VEE, an all-cap Emerging Markets ETF from Vanguard. You want instant broad diversification with a single trade? XAW has a whopping 5,833 holdings, while VEE has 4,249.
Keep in mind that Emerging Markets can be more volatile than developed markets. Those concerned about this but still wanting exposure may consider an alternative suggestion from Yves Rebetez of ETF Insight: XMM, the iShares Edge MSCI EM Minimum Volatility Emerging Markets Index ETF (MER is 0.43% after a fee waiver of 0.39%). For that matter, over the years some panel members have also touted low-volatility ETFs for more developed markets, several of them from BMO ETFs.
International ETF All-Stars 2017
|ETF||Ticker||Management Fee||# of Holdings||Description|
|iShares Core MSCI All Country World ex Canada Index ETF||XAW||0.21%||5,833||Global all-cap fund that's lower cost and tax efficient|
|iShares Core MSCI EAFE IMI Index ETF||XEF||0.20%||2,408||Broad coverage of Europe, Japan & Australia|
|Vanguard FTSE Emerging Markets All Cap Index ETF||VEE||0.23%||4,249||Emerging Markets index that tracks China A shares|