PIE is currently tilted away from perceived momentum emerging markets and heavily allocated to two of the developing world’s most advanced and lowest beta countries: South Korea and Taiwan. Those countries combine for 39% of the ETF’s weight, indicating a momentum ETF can also credibly sport conservative credentials.
Sometimes forgotten in the discussions of PIE’s merits is the ETF’s sector composition. This is not the run-of-the-mill emerging markets ETF dominated by the energy, financial services and materials sectors or some combination of the three. In fact, those sectors combine for just 19.4% of PIE’s weight.
PIE is more levered to the emerging markets consumer story with a combined 34.3% weight to discretionary and staples stocks as well as being more exposed to the improving exports theme with a 16.1% tech weight.
PowerShares DWA Emerging Markets Momentum Portfolio
Tom Lydon’s clients own shares of EEM.