Five years ago, iShares introduced its core suite of ETFs aimed at cost-conscious, long-term investors. One of the original members of the iShares core group of ETFs is the iShares Core MSCI Emerging Markets ETF (NYSEArca: IEMG).
IEMG is the low-cost alternative to the iShares MSCI Emerging Markets ETF (NYSEArca: EEM). Proving that low fees are important to professional investors, too, IEMG has become a force among emerging markets ETFs. Today, IEMG has $40.2 billion in assets under management, making it larger than the older (and pricier) EEM. In fact, IEMG is the second-largest emerging markets ETF, trailing only the Vanguard FTSE Emerging Markets ETF (NYSEArca: VWO).
Another interesting fact about IEMG is that the ETF does not see outflows. As in ever. Since coming to market in mid-October 2012, IEMG has not had a single day of net outflows.
“The iShares Core MSCI Emerging Markets ETF has completed five years since its inception without seeing a single day of net outflows. This year alone, the fund has received $15 billion, almost five times the inflows into the benchmark ETF and 57 percent more than that of the largest fund, the Vanguard FTSE EM ETF,” reports Bloomberg.
Related: How ETF Investors Can Capitalize on Rapid Growth in ETFs
Up 31.3% year-to-date, IEMG has been one of the top asset-gathering ETFs in each quarter of 2017. This year, only three ETFs have added more new assets than IEMG. In the fourth quarter, IEMG has seen inflows of nearly $1.6 billion, putting it ahead of all but four ETFs in terms of new assets added.
“Investors are pouring money into the core ETF as it gives better coverage of the equity universe in developing nations than the main MSCI Emerging Markets ETF, which buys large-cap and mid-cap stocks. The former tracks 2,667 companies accounting for 99 percent of the market, while the latter is confined to 839 constituents spanning 85 percent,” according to Bloomberg.
IEMG, which tracks the MSCI Emerging Markets Investable Market Index, allocates 28% of its weight to Chinese stocks. South Korea and Taiwan combine for over 27% of the ETF’s roster. India and Brazil combine for over 16% of IEMG’s geographic exposure.
Like VWO, IEMG charges 0.14% per year, or $14 on a $10,000 investment.
For more information on the ETF market, visit our ETF performance reports category.
Tom Lydon’s clients own shares of VWO.