ETFs Bridging the Gap to Emerging Markets

Abstract

Emerging markets have become more accessible thanks to the rising number of exchange-traded funds (ETFs) designed to provide emerging markets exposure. This article traces the development of emerging markets ETFs, outlining the size and scope of the market, and examining why investors are increasingly using ETFs as the vehicle of choice for taking their emerging markets exposure. Specific characteristics of emerging markets and emerging markets ETFs are then considered, as are the different index replication techniques available to ETF providers, with an explanation of how this feeds into the functioning of emerging markets ETFs.

The article concludes by looking at how investors use emerging markets ETFs, and how the market is likely to develop in future.

TOPICS: Exchange-traded funds and applications, emerging, in portfolio management