Emerging market equity ETFs have amassed close to $50 billion year to date despite geopolitical turmoil brewing in the Middle East and anticipated interest rate hikes from the US Federal Reserve.
emerging market ETFs
US-based ETF investors are withdrawing en masse from currency-hedged international funds, despite advice to the contrary. The three largest currency-hedged ETFs in the US have seen combined outflows of around $3.5 billion so far this year as the US dollar has declined more than 9% against rival currencies.
Asia Pacific ETFs have been particularly popular with investors in June, according to data from Lyxor, as low valuations in the region attract inflows. This comes at a time when valuations in developed markets are reaching peak levels, while investors continue to look for higher returns.
ETFs investing in frontier countries could become a riskier bet after index provider MSCI upgrades one of its largest constituent countries. Pakistan, which represents more than 11% of the MSCI Frontier Markets 100 Index, is being upgraded to an emerging market.
Emerging Market ETFs have made a surprising comeback in 2017, thanks to a weakening dollar and stabilizing commodities. Here are the top performing single country EM funds.
Institutional investors are allocating to ETFs more than ever driven by market volatility, concerns about liquidity in the bond space and a desire to take advantage of the latest bouts of outperformance, according to a study conducted by Greenwich Associates.