PXH also features a 13.2% weight to Russia, one of the higher allocations to that country among diversified emerging markets ETFs. Significant Russia exposure translates to an almost 24% weight to the energy sector, but Russia has been showing some promise as a dividend destination as the government there pushes its highly profitable companies to increase shareholder payouts.
Importantly, PXH’s fundamental weighting helps investors avoid heavy exposure to stocks that are richly valued. Although the universal view of emerging markets equities at the moment is these stocks are cheap, PXH’s P/E ratio of nine and price-to-book ratio of 0.61 prove the fund is far from frothy when it comes to valuation.
PowerShares FTSE RAFI Emerging Markets Portfolio
ETF Trends editorial team contributed to this post.