ETO vs IEFA Fund Comparison

A comparison between ETO and IEFA based on their expense ratio, growth, holdings and how well they match their benchmark performance.

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Minafi's Take on ETO vs IEFA

Here's an in depth look at the differences between Eaton Vance Tax-Advantaged Global Dividend Opportunities Fund ($ETO) and iShares Core MSCI EAFE ETF ($IEFA).

To start off, here's a look at the basics of each fund. Keep an eye on the FI Score. That's a custom score from 0 to 100 that we generate based on how good this fund is for the casual investor. Most investors only need a handful of total funds in their portfolio. The higher the score, the more likely this is one of those few. Score alone isn't enough! Keep reading on to see how different (or perhaps similar) these two funds are.

44% FI Score
  • eto
  • Mutual Fund
  • Allocation
  • Total World

Eaton Vance Tax-Advantaged Global Dividend Opportunities Fund

Expenses: 2.34% (Better than 0% of similar funds)

This is a bad choice for a Total World Allocation fund. See why »

92% FI Score
  • iefa
  • ETF
  • International Stocks
  • Large Blend

iShares Core MSCI EAFE ETF

Expenses: 0.07% (Better than 1% of similar funds)

This is a great choice for a Large Blend International Stocks fund. See why »

$ETO is classified as a Mutual Fund while $IEFA is classified as an ETF. Even though one of these is a mutual fund and the other is an ETF, that doesn't matter too much for their holdings. Both ETFs and mutual funds are just containers to hold lots of investments inside of them.

The biggest differences between these two is where they may be offered. ETFs are more widely availble from a larger number of investment apps and websites. Mutual funds, on the other hand, are generally offered by the platform they're issued by (Fidelity funds on Fidelity, Vanguard funds on Vanguard). Usually 401(k)'s will offer both ETFs and Mutual Funds. If you're investing outside of a 401(k), I'd recommend you verify the fees associated with ETF and mutual fund transactions. Some platforms charge an additional fee to purchase a mutual fund.

To learn more about the difference between these two, you can read about the difference between ETFs and Mutual Funds.

When evaluating a fund, the first things I look at are:

  • What it invests in
  • How much it charges in fees
  • How large the fund is

Let's look into these criteria one by one and see if either of these funds stands out.

Fund Holdings Comparison

Minafi's FI Score algorithm takes into account the category and market. The more niche a fund is, the lower the score. This doesn't mean it's a worse fund, but it does mean you should stop and make sure this a fund you need to diversify your portfolio.

ETO IEFA
Market Score 10.0 /10 9.8 /10
Category Score 5.0 /10 10.0 /10
Total 15.0 19.8

A score of 10 means this is a solid market and category that almost every investor will want to have investments in. The lower the score, the more specific the investment. These scores are based on when most investors would add these funds to their portfolio. A score of 10 means that this fund (or one like it) belongs in a three-fund portfolio. The lower the score, the farther down in your portfolio a fund would go.

Winner: $IEFA

Fee Comparison

Fees are one of the biggest killers of portfolio growth. The difference between a 2% fee and a 0.04% fee over 30 years can result in your portfolio having half the total value!

If you're just getting started investing and learning how fees impact your portfolio, I'd encourage you to read through my free investment course (specifically '2.2 - All About Fees') where I go over all the different types of fees you can be charged and how to lower them.

For these two funds, ETO has an expense ratio of 2.34% while IEFA has an expense ratio of 0.07%.

Winner: $IEFA

Fund Size Comparison

Both ETO and IEFA have a similar number of assets under management. ETO has in assets under management, while IEFA has 64.1 Billion.

Minafi categorizes both of these funds as large funds. Fund size is a good indication of how many other investors trust this fund. A large fund by itself doesn't mean it's a good fund, but it is one thing to consider when figuring out how to choose the right fund.

Winner: tie

Which Should You Choose? ETO or IEFA?

Comparing these two funds isn't an apples to apples comparison. ETO is a Allocation Total World fund, while IEFA is a International Stocks Large Blend fund.

If you're aiming to build a diversified, low-fee, tax-optimized portfolio you likely won't be choosing between these two funds since they're different enough.

Running both of these funds through Minafi's FI Score algorithm, gives ETO a score of 44 and IEFA a score of 92.

Winner: $IEFA, iShares Core MSCI EAFE ETF

$ETO

Eaton Vance Tax-Advantaged Global Dividend Opportunities Fund

44

Read More
Ratings
Rating Type Rating
Expense Ratio Score 0 /10
Expense Rating 0 /10
Market Score 10 /10
Category Score 5 /10
Overview
Overview Details
Fund Type Mutual Fund
Inception Date Apr-30-2004
Exchange NYSE
Expense Ratio 2.340%
Net Assets
Yield 0.00%
Holdings
Description Info
Market Allocation
Category Total World
Sectors
  • Basic Materials 3.29%
  • Communication Services 11.17%
  • Consumer Cyclical 13.86%
  • Consumer Defensive 6.95%
  • Energy 6.52%
  • Financial Services 13.14%
  • Healthcare 15.01%
  • Industrials 7.64%
  • Real Estate 2.06%
  • Technology 17.81%
  • Utilities 2.54%
Regions
  • Asia Developed 0.48%
  • Asia Emerging 0.15%
  • Australasia 2.24%
  • Europe Developed 22.22%
  • Japan 7.08%
  • North America 60.29%
  • United Kingdom 7.55%

$IEFA

iShares Core MSCI EAFE ETF

92

Read More
Ratings
Rating Type Rating
Diversification Score 8 /10
Expense Ratio Score 10 /10
Expense Rating 9 /10
Market Score 10 /10
Category Score 10 /10
Overview
Overview Details
Fund Type ETF
Inception Date Oct-18-2012
Exchange BATS
Expense Ratio 0.070%
Net Assets 64.1 Billion
Yield 3.71%
Holdings
Description Info
Market International Stocks
Category Large Blend
Sectors
  • Basic Materials 7.21%
  • Communication Services 6.08%
  • Consumer Cyclicals 10.40%
  • Consumer Defensive 11.10%
  • Energy 3.61%
  • Financial Services 15.63%
  • Healthcare 13.65%
  • Industrials 15.49%
  • Real Estate 4.53%
  • Technology 8.66%
  • Utilities 3.64%
Regions
  • Africa/Middle East 0.81%
  • Asia Developed 4.26%
  • Asia Emerging 0.25%
  • Australasia 7.43%
  • Europe Developed 45.28%
  • Japan 26.49%
  • North America 0.66%
  • United Kingdom 14.83%

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