ETFs: A Mildly Amusing Diversion

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One is, of course, expected to diversify. Terribly dull, but apparently necessary. We’re discussing, naturally, those Exchange Traded Funds, specifically the iShares MSCI Emerging Markets ETF (EEM) and the iShares Core MSCI Total International Stock ETF (IXUS). Both offer a glimpse beyond our shores, though with varying degrees of…enthusiasm. EEM confines itself to the rather volatile world of emerging markets, while IXUS casts a wider, and frankly, more sensible net across both developed and developing nations. The question, as always, is which one will prove the least tiresome.

A Snapshot of Fiscal Prudence (or Lack Thereof)

Metric IXUS EEM
Issuer iShares iShares
Expense Ratio 0.07% 0.72%
1-yr Return (as of Jan. 25, 2026) 31.64% 38.76%
Dividend Yield 3.07% 2.06%
Beta 0.75 0.62
AUM $54.25 billion $25.1 billion

IXUS, bless its sensible soul, is demonstrably cheaper and offers a rather more generous dividend yield. One assumes this is to placate investors who’ve realized they’re playing a rather long game. Though, frankly, expecting income from these things is a bit like expecting gratitude.

Performance and the Illusion of Control

Metric IXUS EEM
Max Drawdown (5 yr) -30.05% -39.82%
Growth of $1,000 over 5 years $1,272 $1,050

The numbers, as always, tell a story, though whether it’s a particularly interesting story is debatable. EEM, for all its bravado, seems to have a rather alarming tendency to plummet. IXUS, while not exactly soaring, appears to possess a slightly more refined sense of self-preservation.

What’s Inside the Box?

EEM, with a rather reckless abandon, focuses exclusively on emerging markets, boasting a collection of 1,241 stocks. Historically, it’s had a penchant for the tech sector. Taiwan Semiconductor Manufacturing, ASML Holding, and Samsung are its favored children. One imagines they’re terribly pleased with the arrangement. IXUS, in contrast, casts a wider net, encompassing 4,215 holdings across both developed and emerging markets. Its affections lie primarily with financial services. The top three holdings are the same as EEM’s, though with a slightly more modest weighting. A touch of restraint, you see.

A Word to the Wise (and the Slightly Naive)

Investing in these funds, one hopes, will provide a modicum of insight into international markets. It’s a useful distraction, if nothing else. The price movements of these stocks can differ dramatically from those one is accustomed to in the U.S. – a rather unsettling thought.

Both funds, predictably, have a fondness for Asian companies. And, as everyone knows, Asian markets are prone to a degree of volatility that can be… bracing. Don’t be misled by EEM’s recent performance, either. Over five years, IXUS has risen a respectable 27%, while EEM has limped along with a mere 5%. With a more diversified portfolio and broader international exposure, IXUS appears the more sensible choice for the long-term investor. Unless, of course, one enjoys a bit of excitement.

For further guidance on this rather tedious subject, consult the linked resources. Though, frankly, a good book and a stiff drink are often more rewarding.

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2026-01-26 21:59