I Fund changes

[Bubba]

Just for funsies, I checked the EFA index, which is the same one the I Fund (purportedly) follows. I was a bit shocked to see some country changes:

https://www.morningstar.com/etfs/arcx/efa/portfolio

The top 2 countries are still the UK and Japan, but their weighing is MUCH less than ever. The big risers were France and Switzerland. Good stuff, since France and Switzerland are positive this year. Point being is that there's more "balance" in the weighting. Years ago, Japan and the UK made up between 50 and 60% of the weighting.

Fun changes. Let's see where this goes...

[bloobs]

Thanks for the heads up. I assume this shift is due to market cap changes of its resident companies.

I had also thought Korean and Taiwanese manufacturing and IT would have a larger share of the stocks in there, not sure how I feel about that.

[Bubba]

Thanks for the heads up. I assume this shift is due to market cap changes of its resident companies.

I had also thought Korean and Taiwanese manufacturing and IT would have a larger share of the stocks in there, not sure how I feel about that.

They're usually included in "developing economies" indices. I don't think Korea or Taiwan go into developed indices. I could be wrong...

Here's a list with South Korean ETF holdings...I'm sure you can also search for Taiwan there https://etfdb.com/country/south-korea/

[jimcasada]

The I-fund is based on the Morgan Stanley Capital International (MSCI) EAFE index. EFA is a publicly traded ETF, that is also based on this same MSCI index. They are similar, but not the same. Shares of EFA are publicly traded up & down throughout the day, much like it was an individual stock, while the I-fund generally goes by the actual closing value of all its holdings at the day's end of the various different markets containing these holdings (plus dividends or whatever for that day).

As a general rule, because most of I-funds holding are in mainly in the European markets, the I-fund will most generally match whatever EFA is at (percentage wise) at around 11~12:00 noon (US eastern time). Whatever ETF does after that time can be taken as a general indication of where the I-fund could be likely headed the next day (baring any unforeseen international events that may occur overnight).

[Bubba]

The I-fund is based on the Morgan Stanley Capital International (MSCI) EAFE index. EFA is a publicly traded ETF, that is also based on this same MSCI index. They are similar, but not the same. Shares of EFA are publicly traded up & down throughout the day, much like it was an individual stock, while the I-fund generally goes by the actual closing value of all its holdings at the day's end of the various different markets containing these holdings (plus dividends or whatever for that day).

As a general rule, because most of I-funds holding are in mainly in the European markets, the I-fund will most generally match whatever EFA is at (percentage wise) at around 11~12:00 noon (US eastern time). Whatever ETF does after that time can be taken as a general indication of where the I-fund could be likely headed the next day (baring any unforeseen international events that may occur overnight).

Good point. The difference in letters (EFA to EAFE) always get me. I've worked for many years on their data...interestingly, the blend EAFE index is one of the worst (over a long period) for that index (value is better, dividend "masters" is not bad either).

In any case, importantly, they've changed country importance quite a bit. Switzerland's larger count (over 10%) is an interesting change.

[bloobs]

....the I-fund will most generally match whatever EFA is at (percentage wise) at around 11~12:00 noon (US eastern time). Whatever ETF does after that time can be taken as a general indication of where the I-fund could be likely headed the next day (baring any unforeseen international events that may occur overnight).

I think you may have single-handedly solved the mystery of I fund vs. EFA dissonance that has confused many for years.