“The best reason to own emerging-markets stocks is for the diversification they provide. However, they may also offer higher expected returns than developed-markets stocks when they are trading at lower valuations, as they are now,” according to Morningstar.
IEMG holds nearly 1,900 stocks and allocates almost 28% of its weight to China. South Korea and Taiwan combine for over 28% of the fund’s weight. Morningstar has a bronze rating on the ETF.
For more information on the ETF market, visit our ETF performance reports category.
Tom Lydon’s clients own shares of VWO.