The fund lets emerging market investors position for a growing middle class and younger generation of consumers. [New Dividend ETF for Emerging Markets]
“The investment thesis behind this fund is a logical one: Emerging-markets consumers increasingly are reaching middle-class status and have more disposable income to spend on everything from cars and electronic gadgets to processed foods and beverages,” Morningstar senior fund analyst Patricia Oey wrote in a profile of ECON. “Other growth drivers include the rise of consumer credit, urbanization, and relatively young populations in a number of emerging markets. Personal incomes are growing rapidly as well.” [EGShares Could Self-Index Its ETFs]
ECON has grown to over $1 billion of assets. The ETF has gathered $367 million of inflows this year while emerging market equity ETFs overall have seen about $11.6 billion of net outflows, according to Emerging Global Advisors.
ECON has outperformed the MSCI Emerging Markets Index this year by losing less. However, ECON’s performance edge has slipped over the past month.