The emerging markets have been weighed down on speculation of an end to easy money, growing current account deficits and political problems. However, pre-emerging, frontier market exchange traded funds have held up surprisingly well.

Frontier countries are characterized by their early stages of economic development. Consequently, these markets are less established and less developed than the emerging markets, according to Zacks.

Despite the risks and volatility associated with a developing economy, these countries offer attractive growth opportunities. Frontier markets show low correlation to developed markets. The pre-emerging economies also have relatively lower valuations and higher income yield.

Frontier market related ETFs have outperformed due to their large Middle East country allocations and financial sector tilt. These countries tend to peg their currencies to the U.S. dollar. Consequently, their currencies have held up while many other emerging market currencies faltered. [Global X Could Unveil Combo Emerging/Frontier ETF]

Moreover, the MSCI recently promoted the United Arab Emirates and Qatar to emerging market status, which helped attract large capital flows into the Middle East. [Frontier ETFs Leave Emerging Markets in the Dust]

The iShares MSCI Frontier Markets 100 ETF (NYSEArca: FM) tries to reflect the performance of the MSCI Frontier Markets 100 Index, which consists of the 100 largest securities taken from the MSCI Frontier Markets Index.

FM has a 0.79% expense ratio and is up 14.7% year-to-date.

The fund holds 100 components, and the top holdings include the National Bank of Kuwait 6.5%, Mobile Telecommunications 5.6% and Kuwait Finance House.

Top sectors include financials 55.9%, telecom 14.3% and industrials 11.3%.