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ETF Comparison

EEM vs VWO: Which Is the Better Pick in 2026?

A head-to-head comparison of iShares MSCI Emerging Markets ETF and Vanguard FTSE Emerging Markets ETF covering yield, cost, risk, and income potential.

Data updated July 21, 2026

iShares
ETFs477
Total AUM$4543B

ETFs and AUM reflect what Dividend Vision tracks — the issuer's full lineup may be larger.

iShares is one of the largest ETF providers globally, known for offering a broad, diversified lineup of exchange-traded funds across multiple asset classes and investment strategies. The company operates 215 funds spanning 15 distinct families, including popular offerings in dividend income, covered call strategies, bonds, equities, ESG-focused investments, and factor-based approaches, with widely-held tickers like AGG (bond), ACWI (global equity), and AOA (allocation). iShares is characterized by its comprehensive fund ecosystem that serves both core portfolio holdings and specialized investment strategies, making it a prominent player for investors seeking both traditional and alternative income-generating ETF solutions.

See our curated list of related YouTube videos on EEM.

See all iShares ETFs
Vanguard
ETFs116
Total AUM$4488B

ETFs and AUM reflect what Dividend Vision tracks — the issuer's full lineup may be larger.

Vanguard is known for offering low-cost, passively managed ETFs that emphasize broad market exposure and long-term investing. The company operates 175 ETFs across diverse fund families including Index, Bond, Equity, Dividend, Income, International, Factor, and ESG strategies, serving investors with various goals from core portfolio building to specialized income generation. Notable for its scale and popular tickers like VB (total U.S. small-cap), BND (total bond market), and VBIAX (international bonds), Vanguard focuses on providing comprehensive, index-based investment solutions with an emphasis on cost efficiency and accessibility.

See our curated list of related YouTube videos on VWO.

See all Vanguard ETFs

Side-by-side snapshot

EEMVWO
Full nameiShares MSCI Emerging Markets ETFVanguard FTSE Emerging Markets ETF
IssueriSharesVanguard
Last Close$63.56 as of July 21, 2026$57.93 as of July 21, 2026
Distribution yield1.10%0.49%
Distribution Safety Score™ 7872
Expense ratio0.70%0.06%
AUM$28.1B$120B
Distribution frequencySemi-AnnualQuarterly
Underlying indexMSCI Emerging Markets IndexFTSE Emerging Markets All Cap China A Inclusion Index
ObjectiveProvide exposure to the fund's underlying index or strategy per issuer materials.Track the FTSE Emerging Markets All Cap China A Inclusion Index.
Asset classEquityEquity
Inception date04/07/200303/04/2005
Beta1.030.78
Last dividend$0.3510$0.0710
Ex-dividend date06/15/202606/18/2026

Bottom lineChoose EEM if you want higher current income (1.10% vs 0.49% for VWO). Choose VWO if you want broad equity exposure.

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Visual comparison

Key metrics

Projected income on $10K

Projections assume the current yield and share price remain constant. Actual results will vary.

Total returns

EEM has outpaced VWO over the trailing twelve months, posting a 31.18% total return against 17.70%. The lead holds up over 10 years too: EEM has compounded at 8.30% a year, against 7.80% for VWO. Figures are total returns: price change plus every distribution reinvested.

SymbolYTD1Y3Y5Y10YSince Mar 2005Volatility Sharpe Sortino Max drawdown
EEM13.60%31.18%19.12%6.29%8.30%6.76%19.5%0.670.96-17.3%
VWO6.10%17.70%15.51%5.44%7.80%6.79%16.5%0.610.87-17.4%

Total return with all distributions reinvested on the ex-dividend date, split-adjusted, as of July 20, 2026. YTD and 1Y are cumulative; longer windows are annualized. “Since Mar 2005” measures every fund from March 10, 2005 — the youngest fund's first trading day — so all funds share one comparison window. Volatility is the annualized standard deviation of daily total returns over the trailing 3 years. Sharpe and Sortino divide the annualized return in excess of the risk-free rate by, respectively, that volatility and the downside deviation (both over the trailing 3 years) — higher is better. Max drawdown is the largest peak-to-trough total-return decline over the same window — shallower is better.

Quick verdict

EEM (iShares MSCI Emerging Markets ETF) and VWO (Vanguard FTSE Emerging Markets ETF) are both dividend ETFs, but they take different approaches.

EEM offers the higher yield at 1.10% vs 0.49% for VWO. A higher yield means more current income per dollar invested, though it may come with different risk characteristics.

VWO is cheaper with an expense ratio of 0.06% compared to 0.70%.

They track different benchmarks: EEM is linked to MSCI Emerging Markets Index while VWO tracks FTSE Emerging Markets All Cap China A Inclusion Index, which means their performance drivers differ.

VWO is the larger fund by assets ($120B), which generally means tighter spreads and better liquidity.

Who should choose each?

Choose EEM

iShares MSCI Emerging Markets ETF

  • Want higher current income — EEM yields 1.10% vs 0.49% for VWO.
  • Want broad equity exposure.

Choose VWO

Vanguard FTSE Emerging Markets ETF

  • Want broad equity exposure.
  • Want to keep costs low — a 0.06% expense ratio vs 0.70% for EEM.
  • Prefer lower volatility — a beta of 0.8 vs 1.0 for EEM.

Not sure? Use the income calculator and snapshot above to weigh these trade-offs against your own goals.

Deep dive

Yield & income

On a $10,000 investment, EEM would generate roughly $9.17/month, while VWO would produce $4.08/month, at current distribution rates.

EEM yield1.10%
VWO yield0.49%
Monthly diff on $10K$5.08

Cost & efficiency

Over 10 years on $10,000, EEM would cost approximately $700 in fees vs $60 for VWO (simplified, not compounded). The $640.00 difference may be offset by yield or performance.

EEM ER0.70%
VWO ER0.06%

Strategy & risk

EEM tracks MSCI Emerging Markets Index with an index approach, while VWO tracks FTSE Emerging Markets All Cap China A Inclusion Index with an international approach. Beta is 1.03 for EEM and 0.78 for VWO, indicating VWO is less volatile relative to the market.

EEM beta1.03
VWO beta0.78

Fund details

EEM is managed by iShares (launched 04/07/2003) with $28.1B in assets. VWO is managed by Vanguard (launched 03/04/2005) with $120B in assets.

EEM AUM$28.1B
VWO AUM$120B
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Frequently asked questions

Is EEM or VWO better for dividend income?

It depends on your goals. EEM currently offers the higher distribution yield, which means more income per dollar invested. However, a lower-yield fund may offer better total return or lower volatility. Consider your time horizon and risk tolerance.

What is the difference between EEM and VWO?

EEM (iShares MSCI Emerging Markets ETF) tracks MSCI Emerging Markets Index with an index approach, while VWO (Vanguard FTSE Emerging Markets ETF) tracks FTSE Emerging Markets All Cap China A Inclusion Index with an international approach. They are issued by iShares and Vanguard respectively.

Can I hold both EEM and VWO?

Yes — nothing prevents holding both. Whether the combination actually diversifies depends on how much the underlying exposures overlap, which isn't fully measurable from the data on this page; review each security's holdings, sector, and strategy before treating them as complementary.

Which has lower fees, EEM or VWO?

EEM has an expense ratio of 0.70% while VWO charges 0.06%. Lower fees mean more of your investment returns stay in your pocket over time.

How much income does $10,000 in EEM vs VWO generate?

At current rates, $10,000 in EEM would generate roughly $9.17 per month ($110.00 annually). The same in VWO would produce about $4.08 per month ($49.00 annually).

Which has performed better historically, EEM or VWO?

EEM has outpaced VWO over the trailing twelve months, posting a 31.18% total return against 17.70%. The lead holds up over 10 years too: EEM has compounded at 8.30% a year, against 7.80% for VWO. Figures are total returns: price change plus every distribution reinvested. Past performance does not guarantee future results.

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EEM vs VWO — at a glance

Generated July 2026 from current fund data.

Overview

EEM and VWO are both broad emerging-markets equity ETFs that track different underlying indexes. The key difference is structural: EEM tracks the MSCI Emerging Markets Index via iShares, while VWO tracks the FTSE Emerging Markets All Cap China A Inclusion Index via Vanguard. That difference cascades into meaningfully different costs, yields, and exposure profiles—and dramatically different fund sizes.

How they differ

The biggest structural gap is the expense ratio: VWO costs 0.08% annually versus EEM's 0.70%, a 62-basis-point spread that compounds over years. VWO is also far larger at $119B in assets versus EEM's $30.1B, which typically means tighter bid-ask spreads and lower trading friction. On income, EEM yields 1.07% paid semi-annually, while VWO yields 0.48% on a quarterly schedule—a 59-basis-point gap that reflects both index composition and Vanguard's lower-cost structure. EEM also carries a slightly higher beta (1.03 vs. 0.78), suggesting modestly more sensitivity to emerging-market swings, though both are index trackers with minimal active management risk.

Who each is best for

  • EEM: Fits investors seeking exposure to the MSCI Emerging Markets Index specifically, or those comfortable paying a modest fee premium for iShares' research and analytics integration.
  • VWO: Designed for cost-conscious investors building a long-term emerging-markets position, especially those prioritizing minimal drag from fees and wanting the liquidity that comes with $119B in assets.

Key risks to know

  • Currency exposure: Both funds carry unhedged exposure to dozens of emerging-market currencies. Sharp EM-currency depreciation can erode returns even if underlying equities rise.
  • Index composition timing: The FTSE index used by VWO includes China A-shares at inclusion, which may shift the fund's geographic tilt versus MSCI's approach over time. The two indexes can diverge meaningfully during periods of regulatory change in China.
  • Concentration in large markets: Both funds have material exposure to China, India, Taiwan, and Brazil. A slowdown in any one of these economies can drag returns across the entire fund.
  • Emerging-market political and regulatory risk: Currency controls, capital restrictions, and sudden policy shifts in EM countries can impair liquidity or limit dividend repatriation.

Bottom line

VWO's 62-basis-point cost advantage and vastly larger asset base make it the lower-friction choice for buy-and-hold exposure. EEM's higher yield may appeal to investors seeking current income, though the fee gap means EEM needs to outperform its index by nearly 1% annually just to match VWO's after-cost returns. Both track legitimate EM indexes; the choice hinges on whether lower fees and size matter more than a higher distribution rate. Past performance does not predict future results.

AI-generated analysis for educational purposes only. Verify important details independently; past performance does not guarantee future results.

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