SWISX vs VTIAX: Comparing Two Top International Index Funds

SWISX vs VTIAX: Which International Index Fund Is Right for You?

Investors seeking international diversification often compare Schwab International Index Fund (SWISX) and Vanguard Total International Stock Index Fund (VTIAX). Both funds offer low-cost exposure to non-U.S. stocks, but critical differences in strategy, composition, and cost structure may sway your decision. This in-depth comparison breaks down their key features, performance metrics, and ideal use cases.

Fund Overviews

SWISX: Schwab International Index Fund

• Expense Ratio: 0.06%
• Assets Under Management: $15+ billion
• Holdings: 1,000+ large/mid-cap stocks from developed markets
• Exclusions: No emerging markets or small-cap stocks
• Index Tracked: MSCI EAFE Index

VTIAX: Vanguard Total International Stock Index Fund

• Expense Ratio: 0.11%
• Assets Under Management: $400+ billion
• Holdings: 7,000+ stocks across developed and emerging markets
• Market Coverage: Includes small-cap companies
• Index Tracked: FTSE Global All Cap ex US Index

Key Differences

1. Geographic Exposure

SWISX focuses exclusively on developed markets (Europe, Australasia, Far East), while VTIAX includes:

• 23% emerging markets exposure
• 6% small-cap stocks
• Broader country diversification

2. Cost Comparison

• SWISX: 0.06% expense ratio ($6 annual fee per $10,000 invested)
• VTIAX: 0.11% expense ratio ($11 annual fee)
• Both significantly below category average of 0.82%

3. Historical Performance

Fund	5-Year Return	10-Year Return
SWISX	5.21%	4.89%
VTIAX	5.07%	4.75%

*Past performance not indicative of future results

Tax Efficiency Comparison

• SWISX: 0.34% average annual tax cost
• VTIAX: 0.28% average annual tax cost
• Vanguard’s ETF share class structure enhances tax efficiency

Who Should Choose SWISX?

• Schwab platform users seeking commission-free trading
• Investors wanting pure developed markets exposure
• Cost-sensitive buyers prioritizing lowest expense ratio

Who Should Choose VTIAX?

• Investors wanting true global diversification
• Long-term holders valuing emerging markets growth potential
• Vanguard users benefiting from Admiral Shares pricing

FAQ: SWISX vs VTIAX

1. Which fund has better emerging markets exposure?

VTIAX includes 23% emerging markets vs 0% in SWISX.

2. Can I hold both funds together?

Possible but creates overlap. SWISX covers 85% of VTIAX’s developed markets allocation.

3. Which is more volatile?

VTIAX shows slightly higher volatility due to emerging markets and small-cap holdings.

4. Minimum investment requirements?

• SWISX: $1 minimum
• VTIAX: $3,000 minimum

5. Dividend yields comparison?

VTIAX: 3.12% | SWISX: 2.98% (30-day SEC yield)

Final Verdict

SWISX suits cost-focused investors comfortable with developed markets-only exposure. VTIAX offers comprehensive international diversification at marginally higher cost. Consider your platform preference, risk tolerance, and desired market coverage when choosing between these top-tier international index funds.