The BNY Mellon Emerging Markets Equity ETF (BKEM) tracks an index that offers broad exposure to large cap equities in emerging markets. Stocks are screened out based on liquidity, and the index then targets the largest 70% of companies from each eligible country. BKEM is priced competitively with ultra-low-cost rivals like the SPDR Portfolio Emerging Markets ETF (SPEM), the iShares Core MSCI Emerging Markets ETF (IEMG), the Charles Schwab Emerging Markets Equity ETF (SCHE), and the Vanguard FTSE Emerging Markets ETF (VWO). As a result of its methodology, BKEM owns a smaller universe of securities than those funds, and tilts more heavily toward large cap stocks.
Another important consideration is that BKEM, like IEMG, includes South Korea. By contrast, VEA, SPDW, and SCHF exclude South Korea, classifying it instead with developed markets. Unsuspecting investors who mix and match funds from different firms may find themselves either unintentionally overweight South Korea, or missing out on the country entirely.
BKEM is part of a lineup of ETFs introduced by BNY Mellon in April 2020. As a latecomer to a crowded market, BNY Mellon garnered attention by offering extremely low-fee products, including some of the first zero-fee ETFs, making its new funds some of the cheapest on the market.