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Huge Emerging Markets Fund Offers Diversification

Our coverage of broad-based emerging markets exchange-traded funds (ETFs) today will feature another huge U.S.-based emerging markets fund, iShares MSCI Emerging Markets Index (NYSE: EEM), with a whopping $30.6 billion in net assets.

A â??broad-basedâ?ť emerging markets ETF is one with investments not concentrated in a specific region. The fund seeks to track the investment of the MSCI Emerging Markets Index, which is composed of large- and mid-capitalization emerging market equities.

With money in more than 800 emerging-markets stocks, it is an understatement to say EEMâ??s portfolio is well diversified. The holding with the highest weight in the portfolio only makes up 3.77% of the fundâ??s investments, and all except nine holdings in the portfolio have weightings of less than 1%. This means is that two or three underperformers likely will have scant impact on the fundâ??s overall performance.

EEM has had a terrific year in 2016, with a total cash inflow of more than $6.7 billion, a number exceeded by only four other ETFs in the world…

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Written By

Doug Fabian is the editor of Successful Investing and High Monthly Income, and is the host of the syndicated radio show, "Doug Fabian's Wealth Strategies." Taking over the reigns from his dad, Dick Fabian, back in 1992, Doug has continued to uphold the reputation of the newsletter as the #1 risk-adjusted market timer as ranked by Hulbertâ??s Investment Digest. For more than 30 years, Successful Investing (formerly the Telephone Switch Newsletter) has produced double-digit annual gains. Doug has become known for his expert knowledge and timely use of innovative tools like Exchange Traded Funds, bear funds and Enhanced Index funds to profit in any market climate.