“If the object is just exposure to the emerging markets story, then a passive instrument is the most efficient,” Salami added.
Over the last year, emerging market ETFs have added $4.3 billion in assets, according to BlackRock, compared to the $269 million for country-specific ETFs that cover developed countries. The low ETF costs, as measured by the total expense ratios, have also contributed to the asset’s wider acceptance, especially in the U.S. where a price war has helped push costs lower.
Vanguard Emerging Markets ETF (NYSEArca: VWO)
iShares MSCI Emerging Index Fund (NYSEArca: EEM)
For more information on the emerging markets, visit our emerging markets category.
Max Chen contributed to this article.