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ETFs

Vanguard FTSE Developed Markets ETF

Symbol: VEA
Expense Ratio: 0.09%

We chose Vanguard FTSE Developed Markets because it tracks a FTSE foreign-market index over one that follows the better-known MSCI EAFE index. Both indexes perform similarly, despite the fact that the FTSE developed-market index includes South Korea and the EAFE benchmark does not (MSCI deems South Korea an emerging nation). But we prefer the Vanguard ETF over iShares Core MSCI EAFE (IEFA), the best fund for EAFE lovers, because Vanguard FTSE Developed Markets is bigger, with $28 billion in assets, and more widely traded. It also charges 0.03 percentage point per year less than the iShares ETF.

See Kiplinger ETF 20 at a Glance for the complete list of the best exchange-traded funds.
Visit Winning Model ETF Portfolios for five examples of how you can put ETFs to work.