ETF Watch: iShares Challenges Schwab With New Fund
The latest ETF by the giant issuer competes on cost with some of the cheapest-in-class offerings.
[Editor's Note: The original version of this article stated SCHF’s price tag was 0.07%. It is 0.06%. We regret the error.]
The massive lineup of iShares ETFs just got bigger today, with the launch of the iShares Core MSCI International Developed Markets ETF (IDEV).
Listed on the NYSE Arca, IDEV is the latest fund to offer investors broad exposure to large-, mid- and small-cap equities from developed markets excluding the U.S. The fund tracks the MSCI World ex USA Investable Market Index, offering access to some 22 countries. From a sector perspective, IDEV tilts toward consumer discretionary, financials and industrials, according to the prospectus.
There is little that’s new about this strategy, except perhaps its price tag. iShares offers 20 other developed-market ex-U.S. equity ETFs, none as cheap as IDEV, which comes to market with an expense ratio of 0.07%. That’s $7 per $10,000 invested.
That price tag is only 1 basis point higher than the cheapest developed-market ex-U.S. ETF on the market today, the Schwab International Equity ETF (SCHF). SCHF has $8.1 billion in assets, and is the fifth-largest ETF in this segment. Until March 1, SCHF used to also cost 0.07%, before Schwab lowered the price tag to 0.06%.
A Tad Cheaper
IDEV’s price tag also comes in a mere 1 basis point lower than the expense ratio on the $20.6 billion iShares Core MSCI EAFE ETF (IEFA)—a competing fund in this segment also by iShares. IEFA costs 0.08%.
In all, ETF investors now have 102 flavors of developed-market ex-U.S. equity ETFs to choose from. Some offer total market exposure—such as the biggest fund in the segment, the $66 billion iShares MSCI EAFE ETF (EFA)—as well as some focusing on various factors such as size and high dividend yield. EFA carries a 0.33% expense ratio.
IDEV brings the number of iShares ETFs to 335, together commanding more than $1 trillion in assets.
New Round Of ETF Closures
There was a lineup of seven WisdomTree ETFs that last traded Wednesday, March 22. These ETFs, some of which came to market as far back as 2008, are being shuttered due to lack of assets. Together, these ETFs had combined assets of little more than $41 million.
They include:
- WisdomTree Indian Rupee Fund (ICN)
- WisdomTree Australia & New Zealand Debt Fund (AUNZ)
- WisdomTree Korea Hedged Equity Fund (DXKW)
- WisdomTree Japan Hedged Tech Media & Telecom Fund (DXJT)
- WisdomTree Japan Quality Dividend Growth Fund (JDG)
- WisdomTree International Hedged Equity Fund (HDWM)
- WisdomTree International Hedged SmallCap Dividend Fund (HDLS)
Contact Cinthia Murphy at [email protected]
