Emerging Markets ETFs Continue Gaining Cash

Despite elevated tensions in Eastern Europe, investors continued allocating capital to emerging markets exchange traded funds last week.

Equity-based emerging markets funds tracked by EPFR Global “posted inflows for the fourth week in a row – their longest such run since mid-2Q13 — during the week ending April 23 as commitments to Latin America and Global Emerging Markets equity funds offset outflows from Asia ex-Japan and EMEA equity funds,” according to the data provider.

Speaking of Latin America, the iShares MSCI Brazil Capped ETF (NYSEArca: EWZ) raked in nearly $318 million for the week ending April 25, reversing a trend of outflows seen as the largest single-country ETF tracking a Latin American nation has surged for over a month. [Brazil ETF Finally Sees Inflows]

Amid heightened tensions in Ukraine and following a credit rating downgrade, investors pulled money from Russia ETFs “and funds dedicated to Turkey – which has strong trade and business links with Russia — extended their longest outflow streak of the year-to-date,” according to EPFR Global.

Last Friday, the Market Vectors Russia ETF (NYSEArca: RSX) fell to its lowest level in five weeks after Standard & Poor’s lowered its rating on Russian sovereign debt to BBB-, the lowest investment grade. RSX, the largest Russia ETF, and the iShares MSCI Turkey ETF (NYSEArca: TUR) shed over $18 million in combined assets last week. [Credit Downgrade Weighs on Russia ETFs]

The iShares MSCI Emerging Markets ETF (NYSEArca: EEM), the second-largest emerging markets ETF by assets, gained $37.5 million in new capital last week while the iShares Core MSCI Emerging Markets ETF (NYSEArca: IEMG) brought in almost $20 million.