IEFA vs SCHF: Head-to-Head Comparison

Side-by-Side Comparison

Key Differences Between IEFA and SCHF

IEFA (iShares Core MSCI EAFE ETF) is a international developed fund managed by BlackRock. IEFA tracks the MSCI EAFE index, covering developed market stocks in Europe, Australasia, and the Far East while excluding the U.S. and Canada. It is BlackRock's answer to Vanguard's VEA and offers similar broad international developed market exposure. Beginners who use an iShares-focused brokerage often choose IEFA as their primary international stock fund due to its low cost and massive asset base.

SCHF (Schwab International Equity ETF) is a international developed markets fund managed by Schwab. SCHF invests in large and mid-cap stocks from developed markets outside the U.S., including Europe, Japan, Australia, and Canada. It tracks the FTSE Developed ex US Index and holds over 1,500 companies across more than 20 countries. For beginners, SCHF is one of the cheapest ways to add international stock diversification and reduce dependence on the U.S. market.

The most notable differences are in fees (0.07% vs 0.06%), number of holdings (2,850 vs 1,550), and 5-year returns (6.20% vs 6.80%).

Holdings Overlap Analysis

IEFA and SCHF share 43% of their top holdings. There is moderate overlap, so owning both provides some additional diversification but with diminishing returns.

Cost Comparison Over Time

If you invest $10,000 and hold for 20 years (assuming 8% annual returns):

Over 20 years, the fee difference amounts to $85 on a $10,000 investment. The cost difference is negligible — choose based on other factors.

Which One Should a Beginner Choose?

Choose IEFA if: You want ishares platform users who want a core international developed markets allocation, investors who specifically want msci eafe exposure for benchmarking purposes, those building a tax-efficient international portfolio in taxable accounts. It's managed by BlackRock with an expense ratio of 0.07%.

Choose SCHF if: You want investors building a globally diversified portfolio beyond u.s. borders, schwab customers who want the cheapest developed-market international equity fund, those looking to reduce home-country bias and add geographic diversification. It's managed by Schwab with an expense ratio of 0.06%.

Can You Own Both IEFA and SCHF?

Absolutely! With only 43% overlap, IEFA and SCHF complement each other well. A simple portfolio might allocate 60% to one and 40% to the other, or you could pair them with a bond ETF like BND for a complete three-fund portfolio.

Frequently Asked Questions