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Tuesday, 13 December 2016

ETFs and EMs: a difficult marriage

ETFs and EMs: a difficult marriage:
"The week after Donald Trump was elected US president, emerging market equities had their steepest sell-off since the financial crisis.

Shares in the developing world tumbled amid fears for the future of global trade. Within five days, the main index for emerging market stocks — the MSCI EM — had sunk 6.7 per cent. And exchange traded funds were one easy way investors used to express their newfound aversion to the sector.

Providing money managers and retail investors with a low cost to buy and sell assets, the rise of ETFs has in many ways been a boon for playing emerging markets. ETFs are popular in the developed world, but in emerging markets they are outrunning the competition. Of the $47bn that poured into EM funds during 2016, three-quarters has been allocated to ETFs, according to data from EPFR."

'via Blog this'