Vanguard International ETF Face-Off: VXUS vs. VWO

Vanguard's VXUS and VWO both offer low-cost international diversification but differ significantly in focus. VXUS covers both developed and emerging markets with an 8,602-holding portfolio, while VWO focuses specifically on emerging markets with 5,942 holdings. VXUS delivered 20.1% one-year returns versus VWO's 13.7%, with a lower expense ratio (0.05% vs 0.06%) and higher dividend yield (2.7% vs 2.4%). The analyst recommends VXUS as the better choice due to its broader diversification, lower China exposure (7% vs 26.5%), and superior performance metrics.