Likewise, the positive gains aptly spilled over into emerging market ETFs, such as the Vanguard FTSE Emerging Markets ETF (NYSEArca: VWO)–up 0.85%, iShares Core MSCI Emerging Markets ETF (NYSEArca: IEMG)–up 0.97% and iShares MSCI Emerging Markets ETF (NYSEArca: EEM)–up 1.05%. IEMG, in particular, has started to experience an uptick of inflow activity.
“About a 2% move in emerging markets and a 3% move in China-related ETFs,” said Tom Lydon, president of ETF Trends. “Now I know you’re watching ETFs all the time–$160 billion in new money ETFs so far this year, but the IEMG has $10 billion year to date–$2 billion just in the last month and it’s had a pretty good move from getting emerging market representation for only 14 basis points.”
While the two economic superpowers have locked horns, the renewed talks could resurrect China-focused ETFs and emerging market ETFs like IEMG, which has tracked down 11.3% year-to-date. With respect to value compared to price, many of these ETFs from abroad present a profitable opportunity that can be realized, especially if China and the U.S. ameliorate their trade differences.
“If these talks improve, this might be the link that everyone’s looking for as far as valuations getting better, markets getting better overseas, especially emerging markets and China,” added Lydon.
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