Two Plays Down Under

The dividend, of course, is some compensation for DNH's materials deficiency. DNH has that 6.65% yield, while EWA only yields 3.19%.

Thus, each Australia ETF has its advantages and disadvantages. But there could be some middle ground for investors who like the yield of DNH, but want more materials exposure. A combination of DNH along with a mining stock like BHP or Rio Tinto (RTP Quote) could effectively recreate EWA with much more yield.

As an example, an investor with a diversified portfolio wishing to allocate $20,000 to Australia could put $16,000 in DNH and $4,000 into one of the miners. This blend gives the portfolio a 23% weight to materials, very close to EWA's weight, and a yield of 5.48%.

The investor who can take some single-stock risk may be better off with the DNH and mining stock combination because the yield is so much higher. But for investors leery of owning a single Australian mining stock, the iShares product will capture most of the effect, albeit with a lower yield.