---
title: "NZAC Screens for Climate. IEMG Screens for Growth. Here's How to Choose."
type: "News"
locale: "en"
url: "https://longbridge.com/en/news/285942997.md"
description: "The iShares Core MSCI Emerging Markets ETF (IEMG) and State Street SPDR MSCI ACWI Climate Paris Aligned ETF (NZAC) cater to different investor goals. IEMG offers broad exposure to emerging markets with a lower expense ratio (0.09%) and higher dividend yield (2.20%), while NZAC focuses on climate alignment with a 0.12% expense ratio. IEMG has a higher maximum drawdown but better 1-year returns. Investors must choose between a climate-focused strategy (NZAC) and a traditional emerging markets approach (IEMG)."
datetime: "2026-05-11T12:35:17.000Z"
locales:
  - [zh-CN](https://longbridge.com/zh-CN/news/285942997.md)
  - [en](https://longbridge.com/en/news/285942997.md)
  - [zh-HK](https://longbridge.com/zh-HK/news/285942997.md)
---

# NZAC Screens for Climate. IEMG Screens for Growth. Here's How to Choose.

## Key Points

-   iShares Core MSCI Emerging Markets ETF offers broad exposure to thousands of companies across developing nations at a lower expense ratio than the climate-focused State Street fund.
-   State Street SPDR MSCI ACWI Climate Paris Aligned ETF utilizes an environmental screen to target net-zero alignment while the iShares fund tracks a traditional market-cap index.
-   iShares Core MSCI Emerging Markets ETF has provided a higher distribution yield over the last year but has also experienced a deeper maximum drawdown.
-   10 stocks we like better than iShares - iShares Core Msci Emerging Markets ETF ›

Investors choosing between **State Street SPDR MSCI ACWI Climate Paris Aligned ETF** (NASDAQ:NZAC) and **iShares Core MSCI Emerging Markets ETF** (NYSEMKT:IEMG) must weigh a global climate-tilted strategy against broad emerging markets exposure.

Both funds provide international equity exposure but with fundamentally different goals. NZAC targets a "net-zero" strategy by filtering global stocks for climate risk, while IEMG serves as a low-cost cornerstone for investors seeking large-, mid-, and small-cap companies specifically within developing nations.

## Snapshot (cost & size)

Metric

NZAC

IEMG

Issuer

SPDR

iShares

Expense ratio

0.12%

0.09%

1-yr return (as of May 6, 2026)

29.00%

52.10%

Dividend yield

1.80%

2.20%

Beta

1.04

.99

AUM

$188.8 million

$155.0 billion

_Beta measures price volatility relative to the S&P 500; beta is calculated from five-year monthly returns. The 1-yr return represents total return over the trailing 12 months. Dividend yield is the trailing-12-month distribution yield._

The iShares fund is the more affordable option with a 0.09% expense ratio compared to 0.12% for the SPDR fund. Additionally, the iShares fund offers a higher trailing-12-month distribution yield of 2.20%.

## Performance & risk comparison

Metric

NZAC

IEMG

Max drawdown (5 yr)

(28.30%)

(35.90%)

Growth of $1,000 over 5 years (total return)

$1,591

$1,437

## What's inside

**iShares Core MSCI Emerging Markets ETF** (NYSEMKT:IEMG) provides exposure to 2,661 holdings across technology (23%), financial services (18%), and consumer discretionary (9%). Launched in 2012, its largest positions include **Taiwan Semiconductor Manufacturing** at 12.56%, **Samsung Electronics** at 5.39%, and **SK Hynix** at 3.87%. The fund has a trailing-12-month dividend of $1.85 per share and tracks an index focused on large-, mid-, and small-capitalization emerging market equities.

In contrast, **State Street SPDR MSCI ACWI Climate Paris Aligned ETF** (NASDAQ:NZAC) tracks the MSCI ACWI Climate Paris Aligned Index, filtering 714 holdings for ESG and net-zero alignment. Its largest sector weights are technology (30%) and financials (18%), and top holdings include **Nvidia** (NASDAQ:NVDA) at 5.88%, **Apple** (NASDAQ:AAPL) at 4.40%, and **Microsoft** (NASDAQ:MSFT) at 3.44%. Launched in 2014, the fund has a trailing-12-month dividend of $0.82 per share.

For more guidance on ETF investing, check out the full guide at this link.

## What this means for investors

These two funds rarely end up in the same conversation, and for good reason: They are built for entirely different investors with entirely different goals. NZAC is a global fund spanning both developed and emerging markets, but its defining feature is its climate mandate. It tracks an index aligned with the Paris Agreement, overweighting companies positioned for the low-carbon transition and reducing exposure to high-emission industries. The result is a broadly diversified global portfolio with an environmental lens built in.

IEMG has no climate screen whatsoever. It tracks the full MSCI Emerging Markets index (China, India, Taiwan, South Korea) capturing the growth potential of developing economies regardless of their carbon footprint. That breadth includes energy companies, heavy industry, and state-owned enterprises that NZAC would downweight or exclude entirely.

The fee difference between them is modest, but the philosophical gap is enormous. NZAC suits investors who want global equity exposure aligned with their environmental values. IEMG is the better fit for those making a deliberate bet on emerging market growth without any values-based filter applied.

## Should you buy stock in iShares - iShares Core Msci Emerging Markets ETF right now?

Before you buy stock in iShares - iShares Core Msci Emerging Markets ETF, consider this:

The _Motley Fool Stock Advisor_ analyst team just identified what they believe are the **10 best stocks** for investors to buy now… and iShares - iShares Core Msci Emerging Markets ETF wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.

Consider when **Netflix** made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, **you’d have $471,827**!\* Or when **Nvidia** made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, **you’d have $1,319,291**!\*

Now, it’s worth noting _Stock Advisor’s_ total average return is 986% — a market-crushing outperformance compared to 207% for the S&P 500. **Don't miss the latest top 10 list, available with _Stock Advisor_, and join an investing community built by individual investors for individual investors.**

See the 10 stocks »

_\*Stock Advisor returns as of May 11, 2026._

_Sara Appino has positions in Apple, Nvidia, and Taiwan Semiconductor Manufacturing. The Motley Fool has positions in and recommends Apple, Microsoft, Nvidia, and Taiwan Semiconductor Manufacturing. The Motley Fool has a disclosure policy._

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

### Related Stocks

- [IEMG.US](https://longbridge.com/en/quote/IEMG.US.md)
- [NZAC.US](https://longbridge.com/en/quote/NZAC.US.md)
- [STT.US](https://longbridge.com/en/quote/STT.US.md)
- [TSM.US](https://longbridge.com/en/quote/TSM.US.md)
- [SSNGY.US](https://longbridge.com/en/quote/SSNGY.US.md)
- [SMSN.UK](https://longbridge.com/en/quote/SMSN.UK.md)
- [NVDA.US](https://longbridge.com/en/quote/NVDA.US.md)
- [AAPL.US](https://longbridge.com/en/quote/AAPL.US.md)
- [MSFT.US](https://longbridge.com/en/quote/MSFT.US.md)
- [NFLX.US](https://longbridge.com/en/quote/NFLX.US.md)
- [SPIN.US](https://longbridge.com/en/quote/SPIN.US.md)
- [NVD.DE](https://longbridge.com/en/quote/NVD.DE.md)

## Related News & Research

- [IXUS vs. IEMG: One International ETF Covers the World, the Other Focuses on Its Fastest-Growing Corner](https://longbridge.com/en/news/285841614.md)
- [5 High-Yield BlackRock Dividend ETFs Paying Over 6% Passive Income in 2026](https://longbridge.com/en/news/286648962.md)
- [$100 Invested In iShares S&P 500 Growth ETF 20 Years Ago Would Be Worth This Much Today](https://longbridge.com/en/news/286800978.md)
- [VEU quietly outperformed ACWX in every time period and nobody noticed](https://longbridge.com/en/news/287093367.md)
- [3 Top High-Yield Dividend ETFs Offering Over 9% Passive Income in 2026](https://longbridge.com/en/news/287015808.md)