WisdomTree built a new fund to give ETF investors broad exposure to emerging market nations with solid demographics. The two year old WisdomTree Emerging Markets Consumer Growth Fund (EMCG 11,19 +0,02 +0,18%) has a 2.26% dividend yield and is up 17.8% over the last year. The price action has been better on the MSCI Emerging Markets mainly because of major outperformance in countries like Russia, which does not have the kind of demographics that WisdomTree is looking for. The fund is underweight Russia and Poland compared to the iShares MSCI Emerging Markets (EEM 40,84 +0,07 +0,17%) ETF. Russia and Poland beat the benchmark over the last 12 months.
The MSCI EM has a 19.5% exposure to the four lowest growth nations – Poland (PLND 17,00 -0,27 -1,56%), Russia (Unfortunately, we could not get stock quote NYSEARCA: RSX this time.), Taiwan (EWT 48,37 -0,95 -1,93%) and Thailand (THD 58,97 -0,89 -1,49%). In contrast, EMCG closed the first quarter with just 11.7% exposure in those countries. The idea is that for long term investors, consumer economies will benefit from favorable demographics, just like we will see here.
“For investors who want to further reduce the lowest growth group, try combining EMCG with the WisdomTree India Earnings Fund (EPI) and the WisdomTree China ex-State-Owned Enterprises Fund (CXSE 25,72 -0,81 -3,05%),” says Jeff Weniger, asset allocation strategist for WisdomTree. The idea for long termers: lower exposure to population “dead zones” but still hold China and India in weights that fall between those of the MSCI and FTSE EM indexes. Invest In The World’s Best Demographics
Thanks to the millennials and a robust Latino immigration boom over the last 20 years, no other country in the Americas has the combination of a great demographics and a diverse economy like the United States. We have a second wave baby boom coming, and that has major ramifications for housing and financial markets in general. What about the rest of the world?
For investors looking to take some money off the table here and put it elsewhere, WisdomTree looks at countries with similar demographics. By focusing on countries with the highest population growth as opposed to just countries with the highest population, WisdomTree fund managers believe they are tapping into bigger markets with better growth potential. China has a lot of people, but it has a lot of old people and its population is not growing as fast as Indonesia (IDX 15,94 -0,27 -1,66%), India (EPI 44,04 -0,65 -1,45%), Malaysia (EWM 21,64 -0,16 -0,73%) and South Africa (EZA 39,60 -1,10 -2,70%).
WisdomTree built a new fund to give ETF investors broad exposure to emerging market nations with solid demographics. The two year old WisdomTree Emerging Markets Consumer Growth Fund (EMCG 11,19 +0,02 +0,18%) has a 2.26% dividend yield and is up 17.8% over the last year. The price action has been better on the MSCI Emerging Markets mainly because of major outperformance in countries like Russia, which does not have the kind of demographics that WisdomTree is looking for. The fund is underweight Russia and Poland compared to the iShares MSCI Emerging Markets (EEM 40,84 +0,07 +0,17%) ETF. Russia and Poland beat the benchmark over the last 12 months.
The MSCI EM has a 19.5% exposure to the four lowest growth nations – Poland (PLND 17,00 -0,27 -1,56%), Russia (Unfortunately, we could not get stock quote NYSEARCA: RSX this time.), Taiwan (EWT 48,37 -0,95 -1,93%) and Thailand (THD 58,97 -0,89 -1,49%). In contrast, EMCG closed the first quarter with just 11.7% exposure in those countries. The idea is that for long term investors, consumer economies will benefit from favorable demographics, just like we will see here.
“For investors who want to further reduce the lowest growth group, try combining EMCG with the WisdomTree India Earnings Fund (EPI) and the WisdomTree China ex-State-Owned Enterprises Fund (CXSE 25,72 -0,81 -3,05%),” says Jeff Weniger, asset allocation strategist for WisdomTree. The idea for long termers: lower exposure to population “dead zones” but still hold China and India in weights that fall between those of the MSCI and FTSE EM indexes.
WisdomTree built a new fund to give ETF investors broad exposure to emerging market nations with solid demographics. The two year old WisdomTree Emerging Markets Consumer Growth Fund (EMCG 11,19 +0,02 +0,18%) has a 2.26% dividend yield and is up 17.8% over the last year. The price action has been better on the MSCI Emerging Markets mainly because of major outperformance in countries like Russia, which does not have the kind of demographics that WisdomTree is looking for. The fund is underweight Russia and Poland compared to the iShares MSCI Emerging Markets (EEM 40,84 +0,07 +0,17%) ETF. Russia and Poland beat the benchmark over the last 12 months.
The MSCI EM has a 19.5% exposure to the four lowest growth nations – Poland (PLND 17,00 -0,27 -1,56%), Russia (Unfortunately, we could not get stock quote NYSEARCA: RSX this time.), Taiwan (EWT 48,37 -0,95 -1,93%) and Thailand (THD 58,97 -0,89 -1,49%). In contrast, EMCG closed the first quarter with just 11.7% exposure in those countries. The idea is that for long term investors, consumer economies will benefit from favorable demographics, just like we will see here.
“For investors who want to further reduce the lowest growth group, try combining EMCG with the WisdomTree India Earnings Fund (EPI) and the WisdomTree China ex-State-Owned Enterprises Fund (CXSE 25,72 -0,81 -3,05%),” says Jeff Weniger, asset allocation strategist for WisdomTree. The idea for long termers: lower exposure to population “dead zones” but still hold China and India in weights that fall between those of the MSCI and FTSE EM indexes.