Economic growth in the U.S. in recent years has been virtually non-existent, prompting more and more investors to turn to emerging markets, whose economies–as well as overall populations–are growing at an exponential rate. With the majority of growth occurring overseas, ETF issuers were soon to follow, now offering a wealth of funds to track these booming nations. Relatively new to the emerging market space is Emerging Global Shares, who issued their first ETF in early 2009. Since then, the company has released eight funds to help investors to target developing markets [see also Sector Investing With Emerging Markets ETFs].
Earlier this week, EG Shares announced that four of its most popular funds will undergo splits. Two-for-one splits will occur in EEO, EFN, and EEG, while EMT will split three-for-one. The splits will be effective for all shareholders of record on September 13th, with the actual split payout coming after market close on September 15th. “With the performance of emerging market equities in the last 18 months, an analysis of our funds led us to the conclusion that four of our ETFs were being offered at prices which may put them out of the reach of some investors,” said Robert Holderith, president and CEO of EG Shares [see also ETF Plays On The Next Developed Markets].
Along with splitting these four ETFs, EG Shares is expected to launch the first emerging markets ETF focused exclusively on the consumer sector next week. The four ETFs undergoing share splits include:
Dow Jones Emerging Markets Composite Titans (EEG)
This fund tracks the Dow Jones Emerging Markets Titans Composite Index, which includes approximately 85 individual holdings, but avoids exposure to quasi-developed markets of Taiwan and South Korea. Major names like natural gas giant Gazprom (5.3%), oil supplier Petrobras (4.3%) and China Construction Bank Corporation (3.6%) make the top ten holdings list. From a country perspective, the BRIC accounts for nearly 75% of this fund’s assets, with Brazil leading the way at just over 25% of assets [see EEG's holdings here].
EG Shares Dow Jones Emerging Markets Energy Titans (EEO)
This ETF follows the Dow Jones Emerging Markets Oil and Gas Titans Index, which is designed to represent 30 of the largest emerging-market companies in the oil and gas industry. This mostly giant market cap fund focuses on Europe and Asia, with Russia (30%) and China (21%) receiving the highest country weightings [see EEO's fact sheet here].
EG Shares Dow Jones Emerging Markets Financials Titans (EFN)
This fund measures the Dow Jones Emerging Markets Financials Titans Index, which is designed to represent 30 of the largest emerging-market companies in the financials industry. The all financials fund focuses on China (35.5%), with other countries such as India, Turkey, and Brazil also accounting for substantial portions of the fund’s assets [see EFN's fundamentals here].
EG Shares Dow Jones Emerging Markets Metals & Mining Titans (EMT)
EMT seeks to replicate the Dow Jones Emerging Markets Metals & Mining Titans Index, which focuses on the largest publicly-traded mining companies involved in industrial and precious metals exploration, extraction and production within the emerging world. The fund spreads its assets relatively evenly across Asia, Latin America, Europe and Africa [see EMT's performance charts here].
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Disclosure: No positions at time of writing.