During the past year, WisdomTree's fund has had inflows of $433 million and now ranks as the biggest local currency fund with $1.5 billion in assets. Market Vectors Emerging Markets Local Currency has $1.2 billion. The biggest emerging markets dollar ETF is iShares JPMorgan USD Emerging Markets Bond ( EMB) with $6.9 billion. While Market Vectors is a passive fund, the WisdomTree local currency fund is actively managed. Favoring higher quality issues, WisdomTree's portfolio has a solid investment-grade rating of A. "We overweight countries that have really clean balance sheets," says portfolio manager Rick Harper. Harper is particularly keen on Asian countries, such as Malaysia and Indonesia. Those have limited debt and growing economies. To control risk, Harper has 11% of assets in local currency issues from supranational agencies, such as the World Bank, which carries the top rating of AAA. The Market Vectors fund has an average credit quality of BB, one step below investment grade. The lower-quality names come with more risk, but they deliver richer yields. Market Vectors yields 4.1%, compared to a yield of 3.6% for the WisdomTree Fund. At a time when U.S. bonds pay skimpy yields, the local currency choices offer the potential for better results. If U.S. bonds sink this year, local currency bonds could also fall. But the emerging markets bonds are unlikely to track U.S. Treasuries exactly. Because Asian and Latin American bonds are influenced by a variety of central banks, local currency issues could follow different paths. At the time of publication the author held no positions in any of the stocks mentioned.Follow @StanLuxenbergThis article is commentary by an independent contributor, separate from TheStreet's regular news coverage.
Looking today at week-over-week shares outstanding changes among the universe of ETFs covered at ETF Channel, one standout is the Emerging Markets Local Currency Bond ETF where we have detected an approximate $163.2 million dollar inflow -- that's a 18.1% increase week over week in outstanding units (from 40,800,000 to 48,200,000). START SLIDESHOW:Click here to find out which 9 other ETFs had notable inflows » The chart below shows the one year price performance of EMLC, versus its 200 day moving average: Looking at the chart above, EMLC's low point in its 52 week range is $22.00 per share, with $24.62 as the 52 week high point — that compares with a last trade of $22.06.