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A Look at the Largest International ETF
Posted by Blain Reinkensmeyer
October 31, 2007 at 1:39 am
Do you like to think big? Well if going international is on your mind for a new addition to your investment portfolio look no further then the iShares MSCI EAFE Index (EFA).
The Ishares MSCI EAFE Index (EFA) is the largest international exchange traded fund, or ETF, available today. EFA boasts a market capitalization of $49.44 Billion as of the close today and holds 816 stocks in its portfolio spread literally across the globe.
Performance wise the fund has put up consistently strong numbers year over year:
- 2003 EFA had a return of 38.5%
- 2004 EFA had a return of 19.8%
- 2005 EFA had a return of 13.4%
- 2006 EFA had a return of 26%
- 2007 thus far EFA has a return of 13.1%
This gives EFA a 5 year average return of 23.09%. The fund itself has a focus on large cap stocks with a blend of both value and growth. What this means is that the fund only invests in companies worth atleast $10 Billion focused on both value as in being inexpensive relative to their current value, and growth as in big name growth companies.
The top five countries that the fund is invested in are in order United Kingdom, followed closely by Japan, then France, Germany, and Australia in 5th.
Taking a look at the stock chart you can see the 2007 year in a glimpse (click the chart to view full version, or just click here),
The Bottom Line
If you are looking for long term international exposure the MSCI EAFE Index (EFA) is a ETF to consider as an investment. Like all ideas you must perform your own due diligence, and keep an eye for what you feel is the best opportunity to take a position.
EFA is the largest international exchange traded fund and its boasts a market cap of over $49 Billion. EWA has had a 5 year average return of 23.09% and this year is up 13.1%. Holding 816 stocks from numerous countries gives you great exposure while not being overly volatile price wise.
What is your international exposure? Are you invested internationally?
Hah. Beat me to the punch. Trying to start a series on index and ETFs favored by the options market. Perhaps I shall steal this ETF for my personal use… mwahaha… Happy Halloween!
I am big on watching fees, as this is something we overlook sometimes with mutual funds and ETFs. This one is pretty good I believe as fees are below avg. vs. other ETFs. Also, top 10 holdings account for about 12% of portfolio. They are:
BP
HSBC
Vodafone
Nestle
Total
Toyota Motor
GlaxoSmithKline
Royal Dutch Shell
Nokia
BHP
The total expense ratio is .34% which is nothing compared to what you pay with a mutual fund. To be honest I forgot the fund even had a management fee, good call on mentioning that.
[...] Blain at stocktradingtogo.com does some detailed analysis on the Largest International ETF. [...]