Notable differences in terms of portfolio composition are also evident, as for example IEMG’s top holding is actually an ETF (INDY (iShares S&P India Nifty 50, Expense Ratio 0.89%), at over 6%, and the fund makes up virtually all of the index’s exposure to India (as opposed to individually listed securities).
EEM in comparison has its highest weighting in Samsung Electronics ordinary shares, (Samsung ranks as the number two holding in IEMG at 3.30%).
It is also important to note that the newer “core” ETFs track the MSCI Emerging Markets Investable Markets Index and the MSCI EAFE Investable Market Index respectively (as opposed to the MSCI EAFE and MSCI EM Indexes proper), and it would benefit all portfolio managers and investors to purvey the fact sheets of IEMG/EEM and IEFA/EFA head to head when making the eventual determination of “best fit.”
We see the possibility that some larger institutions may be slower to adopt IEMG and IEFA and may favor the larger and more established EFA/EEM simply due to live trading data in the “ETFs themselves.” This of course is a problem for IEMG and IEFA that will be cured in time as the measurable data timeframe increases to the highly anticipated three and five year numbers, and so on.
For more information on Street One ETF research and ETF trade execution/liquidity services, contact Paul Weisbruch at [email protected].
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