EFAV holds nearly 240 stocks, about 43% of which, on a combined basis, hail from Japan and the U.K. Switzerland and Hong Kong combine for 21.6% of EFAV’s weight.
“So far, the fund’s approach has worked well. From November 2011 through August 2017, it exhibited 22% less volatility than its parent index,” said Morningstar. “And it outpaced the benchmark by 1.6 percentage points annualized during that time. This was primarily thanks to more-favorable stock exposure within several sectors rather than differences in sector weightings.”
EFAV is up 19.2% year-to-date. The ETF allocates a third of its combined weight to financial services and consumer staples stocks. Industrials account for 15.4%.
Investors looking for a cost-effective option for EAFE exposure can consider the iShares Core MSCI EAFE ETF (NYSEArca: IEFA). One of this year’s top asset-gathering ETFs, IEFA charges just 0.08% per year, or $8 on a $10,000 investment.
For more on Smart Beta ETFs, visit the Smart Beta Channel home page.