Reasons to Start Loving Emerging Markets ETFs

The iShares Core MSCI Emerging Markets ETF (NYSEArca: IEMG), the low-cost alternative to IEMG is also one of this year’s top asset-gathering ETFs.In October, BlackRock lowered IEMG’s annual fee to 0.14% from 0.16% as part of a broader range of expense ratio reductions to the iShares core lineup.

“As U.S. interest rates rise, investors need to look overseas to generate returns. The average emerging market ETF is up about 5 percent so far this year, overtaking even the best performing U.S. treasury ETFs,” according to CNBC.

The weaker dollar has been helping emerging markets assets this year and many bond traders believe the Federal Reserve will not raise interest rates next month and it is possible the Fed will not do so again this year.

To this point in the second quarter, two of top 10 asset-gathering ETFs are emerging markets ETFs, including VWO.

For more information on the ETF market, visit our ETF performance reports category.

Tom Lydon’s clients own shares of EEM.