Vanguard Global ETFs Face-Off: Is the Total International Stock ETF or the Emerging Markets ETF the Better Buy?
Key Points
Vanguard Total International Stock ETF provides exposure to both developed and emerging markets at a lower cost than the emerging-markets-only fund
Vanguard FTSE Emerging Markets ETF has higher volatility and a larger maximum drawdown over the past five years compared to the broader international fund
Technology makes up nearly one-third of the Vanguard FTSE Emerging Markets ETF portfolio while the broader fund is more balanced across finance and industrials
- 10 stocks we like better than Vanguard FTSE Emerging Markets ETF ›
Vanguard Total International Stock ETF (NASDAQ:VXUS) provides broad global exposure excluding the U.S., while Vanguard FTSE Emerging Markets ETF (NYSEMKT:VWO) focuses exclusively on developing economies with higher technology concentration.
International diversification is a pillar of balanced portfolios. These two Vanguard funds offer different scopes: one captures the entire world outside America, while the other zooms in on high-growth emerging markets. This comparison examines how their costs, risks, and regional tilts align with different investor goals.
Snapshot (cost & size)
| Metric | VXUS | VWO |
|---|---|---|
| Issuer | Vanguard | Vanguard |
| Expense ratio | 0.05% | 0.06% |
| 1-yr return (as of June 18, 2026) | 32.97% | 29.86% |
| Dividend yield | 2.66% | 2.43% |
| Beta | 0.76 | 0.59 |
| AUM | $652.3 billion | $162.8 billion |
Beta measures price volatility relative to the S&P 500; beta is calculated from five-year monthly returns. The 1-yr return represents total return over the trailing 12 months. Dividend yield is the trailing-12-month distribution yield.
Both ETFs are exceptionally cost-efficient for international investors. The Vanguard Total International Stock ETF carries a 0.05% expense ratio, slightly lower than the 0.06% charged by the Vanguard FTSE Emerging Markets ETF. The broader fund also provides a higher distribution yield.
Performance & risk comparison
| Metric | VXUS | VWO |
|---|---|---|
| Max drawdown (5 yr) | (29.40%) | (32.60%) |
| Growth of $1,000 over 5 years (total return) | $1,544 | $1,309 |
The Vanguard FTSE Emerging Markets ETF (NYSEMKT:VWO) focuses on developing nations such as China and Brazil, holding 6,348 stocks. It is heavily weighted toward Technology at 32.78%, followed by Financial Services at 18.95%, and Consumer Cyclical at 9.92%. Its largest positions include Taiwan Semiconductor Manufacturing (TPE:2330) at 14.66%, Tencent Holdings (HKG:0700) at 2.74%, and Alibaba Group Holding (NYSE:BABA) at 2.26%. This fund was launched in 2005 and has paid $1.53 per share over the trailing 12 months.
The Vanguard Total International Stock ETF (NASDAQ:VXUS) provides wider diversification with 8,738 holdings and was launched in 2011. Its portfolio is led by Financial Services at 21.66%, Technology at 21.04%, and Industrials at 15.55%. Top holdings include Taiwan Semiconductor Manufacturing at 3.98%, Samsung Electronics (KRX:005930) at 2.19%, and SK Hynix (KRX:000660) at 1.86%. It has a trailing-12-month dividend of $2.68 per share.
Which fund is the better buy?
The two Vanguard funds are excellent options for someone seeking low-cost, broad exposure to non-U.S. and emerging markets.
The Vanguard Total International Stock ETF is the better performer over multiple time frames. VXUS has returned 14.2% year-to-date, more than 32% the past year, 20% the past three years, nearly 9% the previous five years, and almost 10% over the past 10 years. That the fund has done so with a slightly lower expense ratio and better dividend yield than its Vanguard counterpart makes it a very appealing choice.
That doesn’t mean the Vanguard FTSE Emerging Markets ETF is a poor choice. It, too, has posted consistently good results. VWO is up more than 13% year-to-date, almost 30% over the past 52 weeks, nearly 17% over the past three years, more than 5% over the 5-year time frame, and 9% over the 10-year time frame.
Judging purely by performance, VXUS is the winner. But long-term investors should be aware of the potential for overlapping holdings across their portfolio. The Total International Stock ETF has exposure to the world outside the U.S., including both emerging markets (26.33% of holdings) and developed markets, led by Europe at 36% of assets. Check whether another fund has sizable exposure to those markets.
The Vanguard FTSE Emerging Market Fund is just that: VWO is focused almost solely on emerging markets, at 99.22% of holdings in emerging markets, and the balance in Europe.
Investors seeking isolated diversification to the more volatile emerging markets would find VWO a good choice.
For more guidance on ETF investing, check out the full guide at this link.
Should you buy stock in Vanguard FTSE Emerging Markets ETF right now?
Before you buy stock in Vanguard FTSE Emerging Markets ETF, consider this:
The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Vanguard FTSE Emerging Markets ETF wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.
Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $417,305!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $1,293,148!*
Now, it’s worth noting Stock Advisor’s total average return is 936% — a market-crushing outperformance compared to 207% for the S&P 500. Don't miss the latest top 10 list, available with Stock Advisor, and join an investing community built by individual investors for individual investors.
See the 10 stocks »
*Stock Advisor returns as of June 19, 2026.
Brendan Coffey has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Vanguard FTSE Emerging Markets ETF. The Motley Fool recommends Alibaba Group. The Motley Fool has a disclosure policy.
Recommended Articles
