Today, we look at two exchange-traded funds (ETFs) that can help investors achieve greater diversification. As well as holding as much as 25% or 30% of their portfolios in U.S. stocks, we believe Canadian investors can benefit from holding up to 10% in international stocks. The best international ETFs offer very low management fees and well-diversified, tax-efficient portfolios of quality stocks. Here are two international ETFs from South Korea and Germany that we view as buys.

ISHARES MSCI SOUTH KOREA INDEX FUND (New York symbol EWY; buy or sell through brokers) aims to track the MSCI Korea Index. The ETF’s top holdings are Samsung Electronics, 24.6%; Hyundai Motor, 3.6%; SK Hynix Semiconductor, 2.8; Shinhan Financial, 2.8%; Naver (Internet), 2.8%; Hyundai Mobis (auto parts), 2.7%; LG Chemicals, 2.4%; Kia Motors, 2.2%; KB Financial, 2.2%; AmorePacific Corp. (cosmetics), 2.1%; Korea Electric Power, 2.0%; KT&G Corp. (tobacco), 1.8%; and Posco (steel), 1.8%.

The iShares MSCI South Korea Index Fund was launched on May 9, 2000. Its expense ratio is 0.62%. South Korea has Asia’s fourth-largest economy, after China, Japan and India. It is heavily reliant on exports, but shipments to the U.S. are rebounding, offsetting weakness in Europe and China

The steady rise of South Korea’s currency, the won, hurt its economy in 2012 and 2013 by making its goods more expensive for foreign buyers. But South Korea has cut interest rates to record lows, bringing the won back down to five-year lows against the U.S. dollar and boosting exports.

In the longer term, the country faces an aging population, with a birth rate of 1.2 children per woman, the lowest in the developed world. South Korea’s economy will likely grow by 2.6% in 2015, down from an earlier forecast of 3.1%.

That’s mostly due to an outbreak of Middle East respiratory syndrome that began in May. Now under control, MERS killed at least 36 Koreans and kept many shoppers and tourists at home.

Still, the country’s economic growth is forecast to rise as high as 3.2% in 2016, and a big stimulus program and low oil prices could push that figure higher: South Korea imports almost all of its oil, bringing in the fifth-largest amount in the world, after Germany.

Recommendation in Canadian Wealth Advisor: BUY for aggressive investors

ETFs: Lower euro a big plus for Germany’s exports

ISHARES MSCI GERMANY FUND $26.83 (New York symbol EWG; buy or sell through brokers) tracks the stocks in the MSCI Germany Index. This index aims to replicate 85% of the market capitalization of the German stock market. The remaining 15% is unavailable for investment, partly due to limitations on foreign ownership.

The ETF’s top holdings are Bayer (diversified chemicals), 9.6%; Daimler (automobiles), 7.3%; Siemens (engineering conglomerate), 7.1%; Allianz (insurance), 7.1%; SAP (software), 6.8%; BASF (chemicals), 6.6%; Deutsche Telekom, 5.1%; BMW AG, 3.1%; Deutsche Bank AG, 3.1%; Munich Reinsurance, 2.9%; Linde AG (industrial gases), 2.9%; Deutsche Post, 2.5%; and Fresenius (health care), 2.4%.

The ETF was launched on March 12, 1996. Its expense ratio is 0.48%.

Weak European markets have slowed Germany’s growth this year, while ongoing sanctions against Russia continue to hurt German firms with a significant number of Russian customers. However, the low euro remains a big plus for its exports, and the long-term outlook for its economy is sound.

Recommendation in Canadian Wealth Advisor: BUY

For our look at the features and practices of different types of investment funds and how they affect you as an investor, read What are the risks and rewards of securities lending?