The iShares Core MSCI EAFE ETF (IEFA) and the SPDR Gold Shares (GLD) are both among the Top 100 ETFs. IEFA is a iShares Foreign Large Blend fund and GLD is a SPDR State Street Global Advisors N/A fund. So, what’s the difference between IEFA and GLD? And which fund is better?
The expense ratio of IEFA is 0.33 percentage points lower than GLD’s (0.07% vs. 0.4%). IEFA also has a higher exposure to the industrials sector and a lower standard deviation. Overall, IEFA has provided lower returns than GLD over the past ten years.
In this article, we’ll compare IEFA vs. GLD. We’ll look at portfolio growth and holdings, as well as at their risk metrics and performance. Moreover, I’ll also discuss IEFA’s and GLD’s fund composition, industry exposure, and annual returns and examine how these affect their overall returns.
|Name||iShares Core MSCI EAFE ETF||SPDR Gold Shares|
|Category||Foreign Large Blend||N/A|
|Issuer||iShares||SPDR State Street Global Advisors|
The iShares Core MSCI EAFE ETF (IEFA) is a Foreign Large Blend fund that is issued by iShares. It currently has 95.78B total assets under management and has yielded an average annual return of 5.79% over the past 10 years. The fund has a dividend yield of 2.28% with an expense ratio of 0.07%.
The SPDR Gold Shares (GLD) is a N/A fund that is issued by SPDR State Street Global Advisors. It currently has 59.26B total assets under management and has yielded an average annual return of 5.81% over the past 10 years. The fund has a dividend yield of 0.0% with an expense ratio of 0.4%.
IEFA’s dividend yield is 2.28% higher than that of GLD (2.28% vs. 0.0%). Also, IEFA yielded on average 0.02% less per year over the past decade (5.79% vs. 5.81%). The expense ratio of IEFA is 0.33 percentage points lower than GLD’s (0.07% vs. 0.4%).
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The iShares Core MSCI EAFE ETF (IEFA) has the most exposure to the Industrials sector at 16.32%. This is followed by Financial Services and Healthcare at 15.91% and 12.01% respectively. Utilities (3.25%), Real Estate (4.31%), and Communication Services (5.53%) only make up 13.09% of the fund’s total assets.
IEFA’s mid-section with moderate exposure is comprised of Basic Materials, Consumer Defensive, Technology, Consumer Cyclical, and Healthcare stocks at 7.93%, 9.78%, 9.81%, 11.96%, and 12.01%.
The SPDR Gold Shares (GLD) has the most exposure to the Technology sector at 0.0%. This is followed by Industrials and Energy at 0.0% and 0.0% respectively. Consumer Cyclical (0.0%), Financial Services (0.0%), and Real Estate (0.0%) only make up 0.00% of the fund’s total assets.
GLD’s mid-section with moderate exposure is comprised of Consumer Defensive, Healthcare, Utilities, Communication Services, and Energy stocks at 0.0%, 0.0%, 0.0%, 0.0%, and 0.0%.
IEFA is 16.32% more exposed to the Industrials sector than GLD (16.32% vs 0.0%). IEFA’s exposure to Financial Services and Healthcare stocks is 15.91% higher and 12.01% higher respectively (15.91% vs. 0.0% and 12.01% vs. 0.0%). In total, Utilities, Real Estate, and Communication Services also make up 13.09% more of the fund’s holdings compared to GLD (13.09% vs. 0.00%).
|ASML Holding NV||1.43%|
|Roche Holding AG||1.31%|
|LVMH Moet Hennessy Louis Vuitton SE||1.08%|
|Toyota Motor Corp||0.92%|
|AIA Group Ltd||0.74%|
IEFA’s Top Holdings are Nestle SA, ASML Holding NV, Roche Holding AG, LVMH Moet Hennessy Louis Vuitton SE, and Novartis AG at 1.77%, 1.43%, 1.31%, 1.08%, and 1.0%.
Toyota Motor Corp (0.92%), AstraZeneca PLC (0.78%), and Unilever PLC (0.76%) have a slightly smaller but still significant weight. AIA Group Ltd and SAP SE are also represented in the IEFA’s holdings at 0.74% and 0.73%.
GLD’s Top Holdings are Gold Trust, N/A, N/A, N/A, and N/A at 100.0%, 0%, 0%, 0%, and 0%.
N/A (0%), N/A (0%), and N/A (0%) have a slightly smaller but still significant weight. N/A and N/A are also represented in the GLD’s holdings at 0% and 0%.
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IEFA had its best year in 2017 with an annual return of 26.42%. IEFA’s worst year over the past decade yielded -14.2% and occurred in 2018. In most years the iShares Core MSCI EAFE ETF provided moderate returns such as in 2010, 2015, and 2016 where annual returns amounted to 0.0%, 0.53%, and 1.36% respectively.
The year 2010 was the strongest year for GLD, returning 27.25% on an annual basis. The poorest year for GLD in the last ten years was 2013, with a yield of -28.09%. Most years the SPDR Gold Shares has given investors modest returns, such as in 2012, 2016, and 2011, when gains were 5.26%, 8.69%, and 11.2% respectively.
|Fund||Initial Balance||Final Balance||CAGR|
A $10,000 investment in IEFA would have resulted in a final balance of $14,008. This is a profit of $4,008 over 7 years and amounts to a compound annual growth rate (CAGR) of 5.79%.
With a $10,000 investment in GLD, the end total would have been $15,308. This equates to a $5,308 profit over 7 years and a compound annual growth rate (CAGR) of 5.81%.
IEFA’s CAGR is 0.02 percentage points lower than that of GLD and as a result, would have yielded $1,300 less on a $10,000 investment. Thus, IEFA performed worse than GLD by 0.02% annually.
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