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A Diversified Foreign Large-Blend ETF With Low Fees

Daniel Sotiroff

Daniel Sotiroff: A new fund that we have on our radar is iShares Core MSCI International Developed Markets ETF (IDEV). It was launched in March 2017, making it just over one year old, and has already garnered about $900 million in assets. It tracks the MSCI World Ex-USA Investible Market Index. 

As its name suggests, it covers the entire market-cap spectrum of stocks listed in foreign developed markets, making it one of the most diversified portfolios in the foreign large-blend category. Stocks listed in foreign developed markets account for roughly 85% of the foreign investable market cap, so this fund could easily be used as a core portfolio holding.

BlackRock charges an ultralow expense ratio of just 7 basis points annually for this fund, which ranks among the lowest in the category. This low-fee advantage is complimented by a construction process that weights holdings by market capitalization--a technique that helps reduce turnover and any related trading costs while maintaining diversification.

The combination of extensive coverage and an ultralow expense ratio should make this fund competitive with other comprehensive, foreign developed-market funds like Vanguard FTSE Developed Markets ETF and iShares Core MSCI EAFE ETF, which currently both carry Analyst Ratings of Silver.