NZAC vs. URTH: Which Global ETF Is the Better Buy?

3 weeks ago 16

Andy Gould, The Motley Fool

Mon, August 3, 2026 astatine 10:47 AM CDT 4 min read

The State Street SPDR MSCI ACWI Climate Paris Aligned ETF (NASDAQ:NZAC) and the iShares MSCI World ETF (NYSEMKT:URTH) some connection investors a elemental mode to bargain planetary stocks successful a azygous fund. But portion NZAC applies a strict clime surface and includes emerging markets, URTH sticks to a premix of developed-world giants with nary specified filter.

Snapshot (cost & size)

Beta measures terms volatility comparative to the S&P 500; beta is calculated from monthly returns implicit the disposable money past (up to 5 years). The 1-year instrumentality represents full instrumentality implicit the trailing 12 months. Dividend output is the trailing-12-month organisation yield.

NZAC is the cheaper of the 2 funds, charging a 0.12% disbursal ratio versus 0.24% for URTH. It besides pays a higher dividend output of 2.06%, compared with 1.40% for URTH.

Performance & hazard examination

Over the past 5 years, URTH has posted higher returns portion besides experiencing a modestly smaller maximum drawdown than NZAC.

What's wrong

Launched successful 2014, NZAC tracks an scale designed to bounds vulnerability to clime modulation hazard portion moving toward net-zero goals, and applies an ESG surface that meets Paris Aligned Benchmark standards. The money spreads its investments crossed 624 holdings, led by Nvidia (NASDAQ:NVDA) astatine 5.7%, Apple (NASDAQ:AAPL) astatine 4.6%, and Microsoft (NASDAQ:MSFT) astatine 2.9%. Its apical sectors see exertion astatine 36.6%, fiscal services astatine 16.2%, and healthcare astatine 9.2%.

URTH casts a wider net, holding 1,284 stocks crossed developed markets, with nary clime oregon ESG filter applied. Its apical 3 holdings are identical to NZAC's -- including Nvidia astatine 5.2%, Apple astatine 4.8%, and Microsoft astatine 3.0%. Its assemblage premix is somewhat little tech-heavy, with 30.9% successful technology, 15.7% successful fiscal services, and 11.4% successful industrials. URTH was launched successful 2012.

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What this means for investors

This examination illustrates a trade-off astir ETF investors yet face: outgo and income versus performance. NZAC's little disbursal ratio and higher output are existent advantages, and for investors who specifically privation their planetary banal vulnerability to travel with a clime mandate, that surface is the full constituent of owning the fund. But cheaper and higher-yielding hasn't translated into amended returns here. URTH's stronger one-and five-year show -- arsenic good arsenic its smaller drawdown -- suggests that sticking to established developed-market bluish chips without an emerging-markets tilt oregon an ESG filter has been the amended move.

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