EEM Offers Focused Growth While IXUS Provides Broad Safety

Key Points
EEM charges a much higher expense ratio than IXUS but delivered a stronger 1-year total return as of March 2026.
IXUS holds nearly 4 times as many stocks, offering broader international diversification, while EEM concentrates on emerging markets with a heavy technology tilt.
EEM's volatility and historical drawdowns have been higher than IXUS, reflecting greater risk exposure.
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Both iShares MSCI Emerging Markets ETF (NYSEMKT:EEM)and iShares Core MSCI Total International Stock ETF (NASDAQ:IXUS)are popular iShares offerings for international exposure, but they serve distinct purposes: IXUS provides comprehensive access to developed and emerging non-U.S. stocks, while EEM zeroes in on large- and mid-cap companies from emerging markets. EEM carries a substantially higher expense ratio and narrower portfolio than IXUS, but it also posted a stronger one-year total return and leans more heavily into technology and emerging-market equities.
This comparison breaks down their cost, diversification, sector tilts, and risk profiles to help investors assess which approach may better fit their goals.
Snapshot (cost & size)
| Metric | IXUS | EEM |
|---|---|---|
| Issuer | iShares | iShares |
| Expense ratio | 0.07% | 0.72% |
| 1-yr return (as of 3/26/2026) | 26.05% | 32.5% |
| Dividend yield | 2.9% | 1.9% |
| Beta | 1 | 0.96 |
| AUM | $52.4 billion | $25.6 billion |
EEM is much more expensive to hold than IXUS, with a 0.72% expense ratio versus just 0.07% for IXUS. IXUS also offers a higher dividend yield, with a 2.9% 12-month trailing yield as of Feb. 28, 2026 compared to EEM’s 1.94%.
Performance & risk comparison
| Metric | IXUS | EEM |
|---|---|---|
| Max drawdown (5 y) | -30% | -37.8% |
| Growth of $1,000 over 5 years | $1,426 | $1,212 |
What's inside
EEM focuses exclusively on emerging markets, with a pronounced tilt toward technology (34%), followed by financial services (21%) and consumer discretionary stocks (10%). The fund holds more than 1,000 companies, but its top names make up a large portion of assets: Taiwan Semiconductor Manufacturing at 13.2%, Samsung Electronics at 5.5%, and Tencent Holdings at 3.8%. EEM has a long track record (23 years) and no unusual structural quirks.
IXUS, by contrast, spreads its more than 4,000 holdings across both developed and emerging markets, with financial services (23%), information technology (15.8%), and industrials (15.6%) as the largest sectors. Its top holdings, Taiwan Semiconductor Manufacturing at 3.6%, Samsung Electronics at 1.5%, and ASML Holding at 1.4%, are less concentrated, providing broader diversification than EEM.
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What this means for investors
Investors looking to diversify their holdings are often told to look into international markets. While that’s solid advice, there are still some decisions to be made when it comes to allocating your dollars to international stocks. One of the biggest differences between EEM and IXUS is the type of international markets they invest in. EEM focuses on emerging markets only, that is, markets in developing nations like Brazil, Russia, India, China, and Taiwan. Emerging markets can be exciting investments, characterized by rapid industrialization, high GDP growth, and increased consumption. But there’s a downside to all this excitement: Emerging markets can be volatile, both economically and politically, and currency fluctuation is a concern.
IXUS mitigates the risk of investing in emerging markets by also holding stocks in developed international markets. This provides diversification away from domestic stocks, but with a little more stability and a higher dividend yield than EEM. Both ETFs hold Taiwan Semiconductor Manufacturing in the No. 1 position, which has been a lucrative bet amid the artificial intelligence boom. But TSMC makes up 13.2% of EEM’s portfolio and only 3.6% of IXUS’, a demonstration of IXUS’ broader diversification.
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Sarah Sidlow has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends ASML, Taiwan Semiconductor Manufacturing, and Tencent. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.