As the appeal of international markets continues to draw investor dollars, Charles Schwab recently announced the launch of two new exchange traded funds (ETFs) which give exposure to overseas markets (Another way to play international markets).
The first is the Schwab Emerging Markets Equity ETF (SCHE), which carries an expense ratio of 0.35% and offers diversified exposure to 470 large and mid-cap stocks in over 20 developing countries. When compared to its competitors, SCHE is cheaper than the iShares MSCI Emerging Markets (EEM) and the SPDR S&P Emerging Markets (GMM). In regards to portfolio weighting, the new ETF allocates most of its assets to financials, energy and materials.
The second newly launched ETF is the Schwab International Small-Cap Equity ETF (SCHC), which carries an expense ratio of 0.35% and offers diversified exposure to international small-cap companies. SCHC holds 876 stocks and allocates the majority of its assets to industrials, financials and consumer discretionary sectors. When compares to its competitors, the new Schwab fund has lower expenses than the Vanguard FTSE All-Wld ex-US SmCp Idx ETF (VSS), the iShares MSCI EAFE Small Cap Index (SCZ) and the SPDR S&P International Small Cap (GWX).
The emergence of these two new ETFs will not only enable Schwab to take a bigger piece of the ETF pie, but will likely bolster net inflows of assets into the ETF landscape (The benefits of ETFs). A recent study conducted by Cogent Research revealed that Charles Schwab is the number one distributor and brokerage firm amongst affluent investors.
