Emerging Market ETF

Definition of 'Emerging Market ETF'


An exchange-traded fund that focuses on the stocks of emerging market economies, such as Latin America, Asia and Eastern Europe. The underling indexes tracked by emerging market ETFs vary from one fund manager to another, but all should be passively managed and contain equities from multiple countries, unless otherwise stated.

Within the broad class of emerging market ETFs, there are fund members that focus on certain market-capitalization ranges, high-dividend stocks, or funds with high allocations towards specific sectors.

Investopedia explains 'Emerging Market ETF'


Emerging market securities are finding their way into more and more portfolios; many investors (especially those with longer time horizons) simply cannot afford to miss out on the higher returns offered by many emerging market economies. These nations are typically identified by high growth rates in areas like natural production, and many have surpluses of rich natural resources that are heavily consumed by the entire world.

Expense ratios for emerging market ETFs may be slightly higher than the average for domestic-focused funds. Trading costs tend to be higher when investing directly in local stock exchanges in emerging market nations.



Related Video for 'Emerging Market ETF'

comments powered by Disqus
Hot Definitions
  1. Jensen's Measure

    A risk-adjusted performance measure that represents the average return on a portfolio over and above that predicted by the capital asset pricing model (CAPM), given the portfolio's beta and the average market return. This is the portfolio's alpha. In fact, the concept is sometimes referred to as "Jensen's alpha."
  2. Direct Bidder

    An entity that purchases Treasury securities at auction for a house account rather than on behalf of another party.
  3. Mortgage Modification

    A permanent change in a homeowner's home loan terms that makes the monthly loan payments affordable.
  4. Leveraged Benefits

    The use – by a business owner or professional practitioner – of their company’s receivables or current income to secure a loan whose proceeds then indirectly fund a retirement plan.
  5. Direct Consolidation Loan

    A loan that combines two or more federal education loans into a single loan. A Direct Consolidation Loan allows the borrower to make a single monthly payment. The loan is facilitated by the U.S. Department of Education and does not require borrowers to pay an application fee.
  6. Through Fund

    A type of target-date retirement fund whose asset allocation includes higher risk and potentially higher return investments "through" the fund's target date and beyond.
Trading Center