IEMG vs. DFEM

Last updated Jun 9, 2026

IEMG (iShares Core MSCI Emerging Markets ETF) and DFEM (Dimensional Emerging Markets Core Equity 2 ETF) are both Emerging Markets Diversified funds. IEMG is passively managed, while DFEM is actively managed. Over the past 3 years, IEMG returned 20.51%/yr vs 20.52%/yr for DFEM. With a 0.98 correlation, they move nearly in lockstep. IEMG charges 0.09%/yr vs 0.39%/yr for DFEM.

Performance

IEMG vs. DFEM - Performance Comparison

The chart below illustrates the hypothetical performance of a $10,000 investment in iShares Core MSCI Emerging Markets ETF (IEMG) and Dimensional Emerging Markets Core Equity 2 ETF (DFEM). The values are adjusted to include any dividend payments, if applicable.

Returns By Period

The year-to-date returns for both investments are quite close, with IEMG having a 18.97% return and DFEM slightly higher at 19.14%.

IEMG

• 1D: 1.70%
• 1M: -3.66%
• YTD: 18.97%
• 6M: 20.80%
• 1Y: 40.80%
• 3Y*: 20.51%
• 5Y*: 6.57%
• 10Y*: 9.88%

DFEM

• 1D: 1.76%
• 1M: -3.62%
• YTD: 19.14%
• 6M: 21.20%
• 1Y: 39.95%
• 3Y*: 20.52%
• 5Y*: —
• 10Y*: —

*Multi-year figures are annualized to reflect compound growth (CAGR)

IEMG vs. DFEM - Yearly Performance Comparison

	2026 (YTD)	2025	2024	2023	2022
IEMG iShares Core MSCI Emerging Markets ETF	18.97%	32.56%	6.50%	11.52%	-5.86%
DFEM Dimensional Emerging Markets Core Equity 2 ETF	19.14%	29.51%	7.53%	13.91%	-9.60%

Correlation

The correlation between IEMG and DFEM is 0.99 - these two move nearly in lockstep. At this level, holding both provides almost no diversification benefit. If you already own one, adding the other does little to reduce portfolio risk.

	Correlation
Correlation (1Y) Calculated over the trailing 1-year period	0.99
Correlation (3Y) Calculated over the trailing 3-year period	0.99
Correlation (All Time) Calculated using the full available price history since Apr 27, 2022	0.98

The correlation between IEMG and DFEM has been stable across timeframes, ranging from 0.98 to 0.99 - a consistent structural relationship.

IEMG vs. DFEM - Sectors Allocation Comparison

Sectors	IEMG	DFEM
Technology	35.0%	32.9%
Financial Services	18.4%	15.4%
Consumer Cyclical	9.5%	9.8%
Industrials	9.0%	11.9%
Basic Materials	6.9%	8.4%
Communication Services	6.4%	5.5%
Energy	3.8%	4.4%
Healthcare	3.7%	3.8%
Consumer Defensive	3.3%	3.7%
Utilities	2.2%	2.2%
Real Estate	1.7%	2.0%

Return for Risk

IEMG vs. DFEM — Risk / Return Rank

Compare risk-adjusted metric ranks to identify better-performing investments over the past 12 months.

IEMG

IEMG Risk / Return Rank: 67
IEMG Sharpe Ratio Rank: 67
IEMG Sortino Ratio Rank: 61
IEMG Omega Ratio Rank: 71
IEMG Calmar Ratio Rank: 68
IEMG Martin Ratio Rank: 69

DFEM

DFEM Risk / Return Rank: 71
DFEM Sharpe Ratio Rank: 70
DFEM Sortino Ratio Rank: 63
DFEM Omega Ratio Rank: 73
DFEM Calmar Ratio Rank: 72
DFEM Martin Ratio Rank: 75

The rank (0–100) shows how this investment's returns compare to the risk taken. Higher = better. Based on the past 12 months of data, combining Sharpe, Sortino, and other metrics used by quantitative funds and institutional investors.

IEMG vs. DFEM - Risk-Adjusted Trends Comparison

This table presents a comparison of risk-adjusted performance metrics for iShares Core MSCI Emerging Markets ETF (IEMG) and Dimensional Emerging Markets Core Equity 2 ETF (DFEM). Risk-adjusted metrics are performance indicators that assess an investment's returns in relation to its risk, enabling a more accurate comparison of different investment options.

	IEMG	DFEM	Difference
Sharpe ratio: Return per unit of total volatility	1.99	2.05	-0.06
Sortino ratio: Return per unit of downside risk	2.58	2.63	-0.05
Omega ratio: Gain probability vs. loss probability	1.38	1.39	-0.01
Calmar ratio: Return relative to maximum drawdown	3.10	3.31	-0.21
Martin ratio: Return relative to average drawdown	11.68	12.67	-0.98
Data is calculated on a 1-year rolling basis and updated daily. The trend shows the change in the indicator over the past month.

IEMG vs. DFEM - Sharpe Ratio Comparison

The current IEMG Sharpe Ratio is 1.99, which is comparable to the DFEM Sharpe Ratio of 2.05. The chart below compares the historical Sharpe Ratios of IEMG and DFEM, calculated using daily returns over the previous 12 months. A higher Sharpe Ratio indicates better risk-adjusted performance relative to the risk-free rate.

Sharpe Ratios by Period

	IEMG	DFEM	Difference
Sharpe Ratio (1Y) Calculated over the trailing 1-year period	1.99	2.05	-0.06
Sharpe Ratio (5Y) Calculated over the trailing 5-year period	0.35	—	—
Sharpe Ratio (10Y) Calculated over the trailing 10-year period	0.49	—	—
Sharpe Ratio (All Time) Calculated using the full available price history	0.33	0.81	-0.49

Drawdowns

IEMG vs. DFEM - Drawdown Comparison

The maximum IEMG drawdown since its inception was -38.71%, which is greater than DFEM's maximum drawdown of -20.82%. Use the drawdown chart below to compare losses from any high point for IEMG and DFEM.

Drawdown Indicators

	IEMG	DFEM	Difference
Max Drawdown Largest peak-to-trough decline	-38.71%	-20.82%	-17.89%
Max Drawdown (1Y) Largest decline over 1 year	-13.21%	-12.12%	-1.09%
Max Drawdown (3Y) Largest decline over 3 years	-17.21%	-18.09%	+0.88%
Max Drawdown (5Y) Largest decline over 5 years	-35.75%	—	—
Max Drawdown (10Y) Largest decline over 10 years	-38.71%	—	—
Current Drawdown Current decline from peak	-7.00%	-6.35%	-0.65%
Average Drawdown Average peak-to-trough decline	-12.97%	-5.03%	-7.94%
Ulcer Index Depth and duration of drawdowns from previous peaks	3.50%	3.16%	+0.34%

Volatility

IEMG vs. DFEM - Volatility Comparison

iShares Core MSCI Emerging Markets ETF (IEMG) and Dimensional Emerging Markets Core Equity 2 ETF (DFEM) have volatilities of 10.33% and 9.87%, respectively, indicating that both stocks experience similar levels of price fluctuations. This suggests that the risk associated with both stocks, as measured by volatility, is nearly the same. The chart below showcases a comparison of their rolling one-month volatility.

Volatility by Period

	IEMG	DFEM	Difference
Volatility (1M) Calculated over the trailing 1-month period	10.33%	9.87%	+0.46%
Volatility (6M) Calculated over the trailing 6-month period	18.35%	17.39%	+0.96%
Volatility (1Y) Calculated over the trailing 1-year period	20.62%	19.59%	+1.03%
Volatility (5Y) Calculated over the trailing 5-year period, annualized	18.62%	17.53%	+1.09%
Volatility (10Y) Calculated over the trailing 10-year period, annualized	20.14%	17.53%	+2.61%

IEMG vs. DFEM - Expense Ratio Comparison

IEMG has a 0.09% expense ratio, which is lower than DFEM's 0.39% expense ratio.

Dividends

IEMG vs. DFEM - Dividend Comparison

IEMG's dividend yield for the trailing twelve months is around 2.31%, more than DFEM's 1.91% yield.

Position	TTM	2025	2024	2023	2022	2021	2020	2019	2018	2017	2016	2015
DFEM Dimensional Emerging Markets Core Equity 2 ETF	1.91%	2.32%	2.50%	2.38%	1.99%	0.00%	0.00%	0.00%	0.00%	0.00%	0.00%	0.00%
IEMG iShares Core MSCI Emerging Markets ETF	2.31%	2.75%	3.20%	2.89%	2.71%	3.06%	1.87%	3.15%	2.76%	2.35%	2.28%	2.53%

Frequently Asked Questions

Can I hold both IEMG and DFEM in my portfolio?

With a correlation of 0.99, IEMG and DFEM move almost identically. Holding both adds very little diversification - you're essentially doubling your position in the same market segment. Choosing one is usually more capital-efficient.

Which is riskier, IEMG or DFEM?

IEMG has higher volatility (10.33%) compared to DFEM (9.87%). In terms of maximum drawdown, IEMG dropped -38.71% vs DFEM's -20.82%.

Which ETF is better, IEMG or DFEM?

On 3-year performance, DFEM leads with 20.52% vs 20.51% for IEMG. On fees, IEMG is cheaper at 0.09% per year. On volatility, DFEM has been the lower-risk option at 9.87%. The better choice depends on whether you care most about return, fees, risk, or income.

Which ETF has performed better, IEMG or DFEM?

Over the 3-year period, DFEM has performed better with a 20.52% return vs 20.51%. Past performance does not guarantee future results, so compare this with risk, fees, and fund exposure.

Which ETF is cheaper, IEMG or DFEM?

IEMG is cheaper with a 0.09% expense ratio, compared with 0.39% for DFEM.

Which ETF pays a higher dividend yield, IEMG or DFEM?

IEMG has the higher dividend yield at 2.31%, compared with 1.91% for DFEM.

What is the main difference between IEMG and DFEM?

They also come from different issuers: iShares and Dimensional. Their fees differ too: 0.09% for IEMG and 0.39% for DFEM.

Which has better risk-adjusted returns?

DFEM currently has the higher Sharpe Ratio (2.05 vs 1.99), meaning it's delivered slightly more return per unit of risk over the trailing 12 months. However, this ranking shifts over time - use the Risk/Return Score above for a more comprehensive view that combines Sharpe, Sortino, and other measures used by quantitative funds.