9 Must-Know Single-Country Emerging Markets ETFs for 2014
December 19th at 8:00am by Tom Lydon
On Thursday, the Federal Reserve finally announced its intent to taper its bond-buying program. The central bank will reduce the amount of its monthly asset purchases to $75 billion from $85 billion with equal reductions to purchases of mortgage and Treasury bonds.
As luck would have it, the tapering news was seen as an affirmation from the Fed that the U.S. economy is strong and that was supportive for emerging markets exchange traded funds. That is correct. One of the asset classes seen as most vulnerable to the loss of Fed stimulus, emerging markets stocks, jumped on the tapering news. To be accurate, the jumping was done by ETFs since most bourses in the developing world are closed while U.S. markets are open. [BlackRock: A Long Haul Emerging Markets ETF]
Still, 2013 will go down as a rough year for emerging markets equities. The Vanguard FTSE Emerging Markets ETF (NYSEArca: VWO) and the iShares MSCI Emerging Markets ETF (NYSEArca: EEM), the two largest emerging markets ETFs by assets, are down an average of 7% this year. Some country ETFs have been much, much worse. [10 Worst Global Equity Markets By Single-Country ETFs]
With an eye to 2014, we offer up nine emerging markets ETFs to consider monitoring as the new year unfolds. The list is admittedly subjective and focuses on single-country ETFs. Diversified ETFs will be featured in another list. The ETFs highlighted here not appear in any particular order.