3 EAFE ETFs Your Broker Forgot To Mention (EFA, DWM, EFAV)

May 02, 2012

 

Investors in search of foreign exposure often look for funds tracking the EAFE Index, targeting Europe, Australia and the Far East. Three such funds might be worth a closer look because they minimize exposure to Japan and the U.K., according to an article on Benzinga.

The popular iShares MSCI EAFE Index Fund (NYSEArca: EFA), which has a combined Japan and U.K. weighting of 44 percent, might best be avoided in favor of the following funds, the ETF Professor, a staff writer for Benzinga.com, said in the article. Those funds are:

  • WisdomTree DEFA Fund (NYSEArca: DWM): Though it has underperformed EFA year-to-date, DWM’s dividend yield is over 100 basis points more, and allocates less to Japan and the U.K.—less than 35 percent—and more weight to Australia, Hong Kong and Singapore.
  • WisdomTree DEFA Equity Income Fund (NYSEArca: DTH): DTH carries some concentration risk, with the U.K., Australia and France making up 52 percent of the ETF, but its yield is nearly 5 percent.
  • iShares MSCI EAFE Minimum Volatility Index Fund (NYSEArca: EFAV): While Japan, the U.K. and Switzerland account for close to two-thirds of EFAV, the fund has limited exposure to financials, with a focus on health care and staples.

 

For the full breakdown on these funds, visit Benzinga.com.

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