If you’re worried about North American equities this year, it might be a good idea to consider diversifying into other parts of the world. An interesting opportunity may be to invest in Europe, which is home to some of the biggest companies in the world. One way to do this is to invest in iShares Europe ETF (NYSE Arca:IEV), which offers investors broad exposure to European equities. With 363 holdings, the fund offers a strong selection from many different sectors and industries.
At 17%, financials are the largest sector in the fund, followed by healthcare and industrials which are both around 15%. Consumer Staples and Consumer Discretionary make up 13% and 11% of holdings, respectively, and are the only other sectors to make up at least 10% of the fund.
Some of the biggest names in exchange-traded funds (ETFs) include Nestle (OTC: NSRGY), Novo Nordisk (NYSE: NVO), and Novartis (NYSE: NVS). However, no single stock represents even 4% of the fund’s total weighting, ensuring that no performance of a single holding will have a drastic impact on the fund as a whole.
The ETF’s expense ratio of 0.58% isn’t the cheapest on the market, but it’s in line with many other similar funds. Investors get good value with this investment and the iShares Europe ETF averages a price-earnings multiple of 14.2 and its price-to-book ratio of two is also not high. Its 3% yield is above average and can give investors decent dividends on top of all that diversification and value.
Investors looking to globalize their portfolio should consider investing in the iShares Europe ETF.