This Day On The Street
Continue to site
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

Emerging-Markets Large-Caps Take on Dow

NEW YORK ( TheStreet) -- As the Dow and S&P 500 slumped last decade, emerging markets boomed.

Now as we start a new decade, iShares has started selling two emerging-market sector exchange traded funds, the iShares MSCI Emerging Market Financial Sector Index Fund (EMFN) and the iShares MSCI Emerging Market Materials Sector Index Fund (EMMT). It's a way to buy into those industries' growth as Brazil, China and other developing countries rise in wealth and stature.

That said, the iShares ETFs are similar to those recently issued by EG Shares, the EG Shares Dow Jones Emerging Markets Financials Titans Index (EFN) and the EG Shares Dow Jones Emerging Markets Metals & Mining Titans Index Fund (EMT).

Despite tracking different indexes, the ETFs own the same mega-cap or blue-chip names. Both are heavy in Brazil and China, and, in the case of the two materials funds, South Africa. The big difference is that the MSCI methodology underlying iShares also takes in South Korea, with the financial fund having a 10% exposure and the materials fund 12%.

The two financial funds have six of their top 10s in common, including Itau Unibanco Holding (ITUB) from Brazil and China Life Insurance (LFC). The materials funds also overlap with names like Vale (VALE - Get Report) from Brazil, Impala Platinum Holdings (IMPUY) from South Africa and Norilsk Nickel (NILSY) from Russia.

The iShares ETF, by virtue of being able to own South Korea, allocates 6.5% to Posco (PKX - Get Report), the mega-cap steel producer. One quirk in the iShares funds, reflected in the iShares MSCI Brazil Index Fund (EWZ), is that it owns both the common and the preferred issues of Vale, which accounts for 18% of the fund. The preferred stock is just as volatile as the common, so a misstep by the company would hurt the iShares fund far more than the EG Shares fund.
1 of 3

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Real Money

More than 30 investing pros with skin in the game give you actionable insight and investment ideas.

Product Features:
  • Access to Jim Cramer's daily blog
  • Intraday commentary and news
  • Real-time trading forums
Only $49.95
14-Days Free
14-Days Free
EWZ $29.51 0.75%
IMPUY $4.20 6.06%
NILSY $14.77 -1.55%
ITUB $9.53 0.42%
LFC $11.51 -1.20%


Chart of I:DJI
DOW 17,773.64 -57.12 -0.32%
S&P 500 2,065.30 -10.51 -0.51%
NASDAQ 4,775.3580 -29.9330 -0.62%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs