The New Jersey Pension Fund, previously one of the largest holders of emerging markets exchange traded funds, is reducing its exposure to ETFs tracking developing world equities.

New Jersey’s pension plan, which has 767,000 beneficiaries, has slashed its stake in the Vanguard FTSE Emerging Markets ETF (NYSEArca: VWO), the largest emerging markets ETF by assets, to “$109 million from $1.9 billion in 2012. Emerging-market equities made up 6.56 percent of the pension fund’s assets as of February, down from 7.65 percent four months earlier and under its target of 8 percent,” Boris Korby reports for Bloomberg.

Year-to-date, VWO and the rival iShares MSCI Emerging Markets ETF (NYSEArca: EEM) have lost about $6.5 billion combined, ranking among the 10 worst ETFs for outflows for a second consecutive year. New Jersey’s departure from emerging markets ETFs comes as the group has been rebounding. [Emerging Markets ETFs Gain New Cash]

Over the past 90 days, VWO and EEM are up an average of 8.5% as stocks from Brazil to India have surged. Performances by those emerging markets ETFs and others are made all the more impressive when considering the struggles of Chinese equities and increased geopolitical volatility courtesy of Russia. [Evidence of a Return to Emerging Markets]

The New Jersey Pension Fund still has a $1.3 billion stake in EEM, Bloomberg reported.

VWO holds 961 stocks, but the ETF allocates 48% of its combined weight to China, Taiwan and Brazil, according to Vanguard data. India is the only other country with a double-digit weight at 10.1%.

At the end of February, in addition to EEM and VWO, the fund held positions in the iShares MSCI EAFE ETF (NYSEArca: EFA), iShares Core MSCI Emerging Markets ETF (NYSEArca: IEMG) and the iShares MSCI South Korea Capped ETF (NYSEArca: EWY), according to the New Jersey Division of Investment.