Emerging Markets Equity

Emerging market equity mutual funds and ETFs own equity securities listed on... Emerging market equity mutual funds and ETFs own equity securities listed on developing market stock exchanges. These funds, which can be actively or passively managed, may, depending on their mandate, own stocks in countries such as Brazil, Russia, India, Chile, Argentina, Pakistan, South Africa, and Poland. Investors buy these funds to gain broad exposure to countries that often have higher rates of growth than developed market economies. In the last decade, emerging market stock indexes have seen their total market capitalization fall relative to developed market economies (in particular, the U.S.). This can be partially blamed on the economic concerns about countries such as Brazil and China, coupled with bullishness on the U.S. However, several emerging markets (such as India and China), have seen their GDP expand considerably in the last decade. Over the long term, emerging markets have the potential to outperform developed market economies—rewarding investors in these regions’ stocks. However, emerging markets can be prone to crisis, so they are not for the faint of heart. As a result, these funds are only appropriate for investors willing to take on a decent amount of risk. Last Updated: 12/08/2023 View more View less

Emerging market equity mutual funds and ETFs own equity securities listed on developing market stock exchanges. These funds, which can be actively or passively managed, may, depending on their mandate, own stocks in... Emerging market equity mutual funds and ETFs own equity securities listed on developing market stock exchanges. These funds, which can be actively or passively managed, may, depending on their mandate, own stocks in countries such as Brazil, Russia, India, Chile, Argentina, Pakistan, South Africa, and Poland. Investors buy these funds to gain broad exposure to countries that often have higher rates of growth than developed market economies. In the last decade, emerging market stock indexes have seen their total market capitalization fall relative to developed market economies (in particular, the U.S.). This can be partially blamed on the economic concerns about countries such as Brazil and China, coupled with bullishness on the U.S. However, several emerging markets (such as India and China), have seen their GDP expand considerably in the last decade. Over the long term, emerging markets have the potential to outperform developed market economies—rewarding investors in these regions’ stocks. However, emerging markets can be prone to crisis, so they are not for the faint of heart. As a result, these funds are only appropriate for investors willing to take on a decent amount of risk. Last Updated: 12/08/2023 View more View less