VWO vs EEM: Head-to-Head Comparison
VWO vs EEM: Vanguard FTSE Emerging Markets ETF has an expense ratio of 0.08% while iShares MSCI Emerging Markets ETF charges 0.68%. VWO holds 5,830 securities vs EEM's 1,200. 5-year returns: 3.20% vs 3.50%.
Last updated: April 2026
Emerging Markets
Quick Verdict
Both ETFs score equally well for beginners (9.5/10). Your choice depends on your specific investment goals.
Side-by-Side Comparison
| Metric | VWO | EEM |
|---|---|---|
| Expense Ratio | 0.08% | 0.68% |
| AUM | $75.0B | $20.0B |
| Dividend Yield | 3.20% | 2.30% |
| Holdings | 5,830 | 1,200 |
| 1-Year Return | 7.20% | 7.00% |
| 5-Year Return (Ann.) | 3.20% | 3.50% |
| 10-Year Return (Ann.) | 3.50% | 3.50% |
| Beta | 0.88 | 0.88 |
| P/E Ratio | 14.5 | 14.8 |
VWO 5-year annualized return is 3.20% compared to EEM's 3.50%. Over 10 years, VWO returned 3.50% vs EEM's 3.50%.
View data table
| Period | VWO Return | EEM Return |
|---|---|---|
| YTD | 1.50% | 1.80% |
| 1 Year | 7.20% | 7.00% |
| 3 Year | -0.80% | 0.50% |
| 5 Year | 3.20% | 3.50% |
| 10 Year | 3.50% | 3.50% |
Key Differences Between VWO and EEM
VWO (Vanguard FTSE Emerging Markets ETF) is a emerging markets fund managed by Vanguard. VWO gives investors access to stocks in emerging economies such as China, India, Brazil, Taiwan, and South Africa. These countries have younger populations and faster economic growth potential than developed nations. Beginners should know that emerging markets can be more volatile than developed markets, but VWO offers this higher-growth exposure at a very low cost of 0.08%.
EEM (iShares MSCI Emerging Markets ETF) is a emerging markets fund managed by BlackRock. EEM tracks the MSCI Emerging Markets Index, offering exposure to large and mid-cap stocks across over 20 developing countries. As one of the original emerging market ETFs launched in 2003, it pioneered accessible EM investing for everyday investors. While newer and cheaper alternatives like IEMG now exist, EEM remains highly popular due to its enormous options market and deep liquidity.
The most notable differences are in fees (0.08% vs 0.68%), number of holdings (5,830 vs 1,200), and 5-year returns (3.20% vs 3.50%).
VWO vs EEM multi-factor comparison: VWO has a 0.08% expense ratio, 3.20% 5-year return, 5,830 holdings, 0.88 beta, and 3.20% yield. EEM has 0.68% expense ratio, 3.50% 5-year return, 1,200 holdings, 0.88 beta, and 2.30% yield.
View data table
| Metric | VWO | EEM |
|---|---|---|
| Expense Ratio | 0.08% | 0.68% |
| 5-Year Return | 3.20% | 3.50% |
| Holdings | 5,830 | 1,200 |
| Beta | 0.88 | 0.88 |
| Dividend Yield | 3.20% | 2.30% |
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Holdings Overlap Analysis
43%
Holdings Overlap
VWO and EEM share 43% of their top holdings. There is moderate overlap, so owning both provides some additional diversification but with diminishing returns.
VWO and EEM share 43% of their top holdings (moderate overlap). VWO has 5,830 total holdings and EEM has 1,200. Common holdings include TSM, TCEHY, BABA.
View data table
| Metric | VWO | EEM |
|---|---|---|
| Overlap | 43% | 43% |
| Unique Holdings | 57% | 57% |
| Total Holdings | 5,830 | 1,200 |
Cost Comparison Over Time
If you invest $10,000 and hold for 20 years (assuming 8% annual returns):
VWO
Fee cost: $686
EEM
Fee cost: $5,531
Over 20 years, the fee difference amounts to $4,845 on a $10,000 investment. VWO saves you more in fees over time.
On a $10,000 investment over 20 years at 8% return, VWO (0.08% fee) grows to $45,924 while EEM (0.68% fee) grows to $41,078. The fee difference costs $4,846.
View data table
| Year | VWO Value | EEM Value |
|---|---|---|
| 0 | $10,000 | $10,000 |
| 5 | $14,639 | $14,237 |
| 10 | $21,430 | $20,268 |
| 15 | $31,371 | $28,854 |
| 20 | $45,924 | $41,078 |
Which One Should a Beginner Choose?
Choose VWO if: You want long-term investors who want exposure to the world's fastest-growing economies, those building a globally diversified portfolio who want to pair vwo with vea for full international coverage, contrarian investors who believe emerging markets are undervalued relative to u.s. stocks. It's managed by Vanguard with an expense ratio of 0.08%.
Choose EEM if: You want active traders and options investors who need the deepest em etf liquidity available, short-term tactical allocators making quick bets on emerging market direction, institutional investors benchmarking to the msci emerging markets index. It's managed by BlackRock with an expense ratio of 0.68%.
Can You Own Both VWO and EEM?
Absolutely! With only 43% overlap, VWO and EEM 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
Should I buy VWO or EEM?▾
Both ETFs score equally well for beginners (9.5/10). Your choice depends on your specific investment goals. However, both are solid options. VWO is best for investors who want long-term investors who want exposure to the world's fastest-growing economies, while EEM is better suited for active traders and options investors who need the deepest em etf liquidity available.
What is the difference between VWO and EEM?▾
VWO (Vanguard FTSE Emerging Markets ETF) tracks emerging markets investments with 5,830 holdings and a 0.08% expense ratio. EEM (iShares MSCI Emerging Markets ETF) focuses on emerging markets with 1,200 holdings at 0.68%. Their top holdings overlap by 43%.
Can I own both VWO and EEM?▾
Yes! With only 43% holdings overlap, VWO and EEM complement each other well. Owning both gives you broader diversification.