Investors looking to increase their equity portfolio's diversification might consider exchange-traded funds (ETFs) that track global indexes. One such index is the Morgan Stanley Capital International (MSCI) World Index, which includes more than 1,600 large- and mid-cap companies in developed markets, with U.S. companies making up about two-thirds of the index. The companies in the index come from the United States and Canada, 16 countries in Europe and the Middle East, and five countries in the Asia-Pacific region. Technology, health care, and financial companies comprise a disproportionately large share of the index. The MSCI World Index has underperformed the market as represented by the S&P 500 in the past year. The MSCI World Index has provided 1-year trailing total returns of 18.8% compared with 23.8% for the S&P 500.
- The MSCI World Index has underperformed the S&P 500 in the past year.
- URTH is the best (and only) MSCI World Index ETF.
- The top holdings of URTH are Apple Inc., Microsoft Corp., and Amazon.com Inc.
There is one ETF that tracks the MSCI World Index, excluding leveraged and inverse funds as well as those with under $50 million in assets under management. The iShares MSCI World ETF (URTH) is the best and only fund. Below, we'll take a closer look at URTH. Figures above are as of August 27 and all other data is as of August 29th.
- 1-Year Total Return: 17.6%
- Expense Ratio: 0.24%
- Annual Dividend Yield: 1.79%
- 3-Month Average Daily Volume: 81,905
- Assets Under Management: $948.6 million
- Inception Date: January 10, 2012
- Issuer: iShares
URTH is a global investment fund that holds a broad range of domestic and international securities, thus providing strong diversification. The fund focuses primarily on large-cap growth equities. As one of the broadest equity products on the market, URTH is distinguished from one of its closest competitors, the Vanguard Total World Stock ETF (VT). While URTH focuses on developed markets, VT also includes emerging markets. Below are the top 10 holdings for URTH.
|Top 10 URTH Holdings|
|Stock||% of URTH Assets||Description of Company|
|Apple Inc. (AAPL)||4.6||Technology|
|Microsoft Corp. (MSFT)||3.5||Technology|
|Amazon.com Inc. (AMZN)||3.1||E-commerce, cloud computing|
|Facebook Inc. (FB)||1.5||Social media|
|Alphabet Inc. Class C (GOOG)||1.1||Internet services holding company|
|Alphabet Inc. Class A (GOOGL)||1.1||Internet services holding company|
|Johnson & Johnson (JNJ)||0.9||Health Care Products|
|Nestlé SA (NESN)||0.8||Food and beverage|
|Visa Inc. (V)||0.8||Financial services|
|Procter & Gamble Co. (PG)||0.7||Consumer goods|