Despite the performance shown by emerging markets in the last few months, there are still investors too skittish to take positions. By using exchange traded funds (ETFs) to get emerging market exposure, they may find it less daunting.

Many executive pension fund managers worldwide are pouring assets into emerging markets in an effort to gain more bang for the buck. As the recession has wound down, emerging markets generally have fared better than developed ones, making them an appealing destination for cash, reports Thoa Hua for Pensions & Investments.

Recently, long-held assumptions about emerging markets have been challenged, including their level of volatility, liquidity limits and their overall ability to survive an economic crisis. (Why ETFs are ideal as emerging market plays).

To the surprise of many, it was the emerging markets that recovered before the developed world even begin to dream of a turnaround. Gary Gordon for ETF Expert notes that while it’s true that emerging markets were among the first to fall, they were also the first to recover. (Six things you’re missing by not being global).

In the long-term, many expect that emerging markets will only continue to become major contributors to the health of the global economy. They already account for one-third of the global GDP and 10% of the world’s market capitalization. To ignore them would be to lead a gigantic hole in your portfolio.

Although emerging markets are recovering handsomely and are well ahead of developed market ETFs, it’s still wise to proceed with caution. Protect yourself by using an exit strategy, which you can read about here.

For more stories about emerging markets, visit our emerging markets category.

• iShares MSCI Emerging Markets (NYSEArca: EEM): up 54.1% year-to-date

• Vanguard Emerging Markets (NYSEArca:VWO): up 61% year-to-date

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

Tags: EEM, Emerging Markets, Global ETFs, VWO