iShares, the BlackRock unit and the worldâs biggest ETF
company, filed four separate registration statements with U.S.
regulators to market a number of emerging markets ETFs that slice
the segment into growth and value strategies, as well as three
Asia-focused funds and a sector fund focused on consumer
The six new ETFs amount to iSharesâ efforts to further slice
and dice the emerging markets segment as investors continue to look
outside of the developed economies for prospective investment
opportunities especially now, as concerns over Europeâs debt load
and slacking U.S. growth mount.
One of the Asian funds is a broad-based ETF, and the other two
target Indiaâone broad-based the other focused on small-cap
Indian firms, according to separate regulatory filings detailing
the funds. Asia is perhaps the most vibrant region in the world
economy and, more so than China, many see India with better
long-term prospects than China based on younger demographics and
The emerging markets consumer ETF marks iShares' attempt to give
investors access to growing consumer demand in the emerging
markets. Companies such as Emerging Global Advisors have had
success with this strategy. The EGShares DJ Emerging Markets
Consumer Titans ETF (NYSEArca:ECON) has almost $250 million in
assets, and is the New York firmâs single-most successful
Slicing Emerging Markets Into Growth and Value
Both the iShares MSCI Emerging Markets Growth Index Fund and the
iShares MSCI Emerging Markets Value Index Fund will track MSCI
indexes that pick securities from the broader MSCI Emerging Markets
Index, the same index anchoring the iShares MSCI Emerging Markets
Index Fund (NYSEArca:EEM), according to respective filings.
EEM, which until January of this year was the worldâs largest
emerging ETF, has about $32 billion in assets. Itâs now second
only to Vanguardâs MSCI Emerging Markets ETF (NYSEArca:VWO),
which boasts $45 billion in assets.
iSharesâ new funds would go head-to-head with a pair of Global
X ETFs that, while linked to Russell benchmarks, offer the same
focus on growth and value stocks.
But neither the Global X Russell Emerging Markets Growth ETF
(NYSEArca:EMGX) nor the Global X Russell Emerging Markets Value ETF
(NYSEArca:EMVX) has attracted sizable assets. They have each
gathered about $2.2 million in assets since their January
MSCI evaluates each security with growth and value factors,
looking at forecasted earnings growth rates, book value to price
ratios, forward earnings to price ratios and dividend yields in
order to determine whether the stock is a growth opportunity or a
Some companies might be included in both portfolios, the company
said in the filings.
Both funds span their exposure across some 20 countries, but the
growth portfolio hones in on financial, information technology and
material companies, while the value mix includes energy, financial
and telecommunication service names.
Emerging Asia Fund
In a separate filing, iShares detailed plans to launch the
iShares MSCI Emerging Markets Asia Index Fund, which in some ways
combines many of the firmâs extensive lineup of MSCI-linked
Among those are the iShares MSCI Taiwan ETF (NYSEArca:EWT), the
iShares MSCI Indonesia Investable Market ETF (NYSEArca:EIDO) as
well as funds focused on the Philippines, Malaysia and
The new emerging Asian ETF will replicate the
free-float-adjusted market capitalization-weighted MSCI Emerging
Markets Asia Index that tracks companies in Hong Kong, India,
Indonesia, Malaysia, Philippines, South Korea, Taiwan and
Financial, information technology and material companies are
included in the mix. The fund might rely on derivatives instruments
to execute its strategy, the filing said.
In two other filings, the San Francisco-based ETF company
detailed the iShares MSCI India Index Fund and the iShares MSCI
India Small Cap Index Fund,
Eyeing Developing Market Consumers
The iShares MSCI Consumer Discretionary Index Fund will zoom in
on the consumer discretionary segment in 14 countries, including
some of the largest consumer bases in the emerging economies, such
as Brazil, Hong Kong, South Korea, Mexico, Poland and Turkey.
The exposure will be focused on car and auto part manufacturers,
consumer durables and apparel companies, consumer service names as
well as media producers and retailers, the filing said.
iShares already offers other emerging market sector funds, such
as the $19 million iShares MSCI Emerging Markets Financial Sector
Index Fund (NYSEArca:EMFN) and the $9 million iShares MSCI Emerging
Markets Materials Sector Index Fund (NYSEArca:EMMT). Â They
were launched about a year and a half ago.
No tickers or fees were disclosed for any of the funds in the
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