Emerging-market exchange traded funds (ETFs) have been popular lately because of their generally strong performance over the past few years. The great thing about emerging-market ETFs is that there is wide selection; almost every ETF provider offers one, as Gary Gordon for ETF Expert notes. Yet, with many choices comes responsibility; investors need to look at the options and see what, if any, meet their financial goals. One way to tell them apart is through their country holdings. Here’s a comparison:

• Vanguard Emerging Markets Stock ETF (VWO)
  South Korea dominates this ETF at 15.1%. Taiwan is next at 12.4%, followed by Hong Kong at 10.9%, Brazil at 9.4% and South Africa at 7.6%. VWO is currently up 18.4% year-to-date.
• SPDR S&P Emerging markets (GMM)
  GMM is equally heavy in Brazil and Hong Kong at 12.0%. Next comes South Africa at 8.9%, Taiwan at 6.6% and India at 6.3%. Having launched in March, GMM is currently up 6.3% over the last three months.
• iShares MSCI Emerging Markets (EEM)
  South Korea also is the largest holding in EEM at 15.8%. However, it differs from VWO in its lower holdings. Hong Kong gets 12.2%, Brazil has 11.6%, Taiwan gets 9.6% and South Africa at 8.4%. EEM is up 14.2% year-to-date.
• WisdomTree Emerging Markets High-Yielding Equity Fund (DEM)
  This ETF invests a whopping 27.8% in Taiwan, followed by 11.3% in Brazil, 9.3% in Korea, 8.7% in South Africa and 8.2% in Thailand. DEM just launched in July, which was bad timing, so it’s down 5.0% over the last month.

For full disclosure, some of Tom Lydon’s clients own EEM.

Tags: Brazil, South Africa, South Korea, Taiwan, Thailand

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