Emerging Markets Funds & Emerging Markets etf

The emerging market countries have done very well in the global economy and have been providing investment returns of more than 50% this year (2009) for related emerging markets etfs (exchange traded funds). However the definition of what is an emerging market varies from index to index.

Now according to Credit Suisse Portfolio Strategy from November 30^th there will be some changes to the MSCI Emerging Markets Index. There will be 32 additions and 19 deletions with Brazil accounting for 40% of the trading in emerging markets. MSCI emerging market standard trackers expect $2.8 billion in total trading, led by China and Brazil.

ETF iShares MSCI emerging markets tracks the MSCI emerging markets index. MSCI has now included Taiwan, South Korea and Israel in the MSCI emerging markets index but there is not total agreement that these are emerging markets.

An alternative emerging market ETF is provided by Emerging Global Advisors . This is the Emerging Global Shares Dow Jones Emerging Markets Titans Composite ETF. This etf does not include Taiwan, South Korea and Israel, as these are seen as developed markets by the IMF (International Monetary fund) and the Dow Jones Indexes. A lot of people  feel that any true investment in emerging markets should not include these countries.

If you wish to invest in emerging market etfs, it is very wise to know the definitions that the various indexes provide when it comes to these growing economies. It is a wise precaution to look at the make up of all ETFs before investing, to make sure that the investment exposure you’re going to get is the exposure you want.