ETFdb Logo
  • ETF Database
  • Channels
    • Themes
      • Active ETF
      • Alternatives Channel
      • Artificial Intelligence
      • China Insights
      • Climate Insights
      • Core Strategies
      • Crypto
      • Disruptive Technology
      • Energy Infrastructure
      • ETF Building Blocks
      • ETF Education
      • ETF Investing
      • ETF Strategist
      • Faith-Based Investing
      • Financial Literacy
      • Fixed Income
      • Free Cash Flow
      • Innovative ETFs
      • Invest Beyond Cash
      • Leveraged & Inverse
      • Modern Alpha
      • Portfolio Strategies
      • Tax Efficient Income
    • Asset Class
      • Equity
        • U.S. Equity
        • Int'l Developed
        • Emerging Market Equities
      • Alternatives
        • Gold/Silver/Critical Materials
        • Crypytocurrency
        • Currency
        • Volatility
      • Fixed Income
        • Investment Grade Corporates
        • US Treasuries & TIPS
        • High Yield Corporates
        • Int'l Fixed Income
    • ETF Ecosystem
    • ETFs in Canada
    • Market Outlook
  • Tools
    • ETF Screener
    • ETF Country Exposure Tool
    • ETF Database Categories
    • Indexes
    • Scenario Analysis
    • Watchlists
    • Head-To-Head ETF Comparison Tool
    • Mutual Fund To ETF Converter
    • ETF Stock Exposure Tool
    • ETF Issuer Fund Flows
  • Research
    • ETF Education
    • Equity Investing
    • Dividend ETFs
    • Leveraged ETFs
    • Inverse ETFs
    • Index Education
    • Index Insights
    • Top ETF Sectors
    • Top ETF Issuers
    • Top ETF Industries
  • Webcasts
  • Themes
    • AI ETFs
    • Blockchain ETFs
    • See all Thematic Investing ETF themes
    • ESG Investing
    • Marijuana ETFs
  • Multimedia
    • ETF 360 Video Series
    • ETF of the Week Podcast
    • Gaining Perspective Podcast
    • ETF Prime Podcast
    • Video
  • Company
    • About VettaFi
    • Get VettaFi’ed
  • PRO
    • Pro Content
    • Pro Tools
    • Advanced
    • FAQ
    • Pricing
    • Free Sign Up
    • Login
  1. Modern Alpha Channel
  2. Among Emerging Markets, India Is Intriguing
Modern Alpha Channel
Share

Among Emerging Markets, India Is Intriguing

Tom LydonOct 07, 2022
2022-10-07

This year will go down as another forgettable one for emerging markets stocks as the widely observed MSCI Emerging Markets Index is lower by 24.8% year-to-date, as of October 6.

Of course, that’s a broad benchmark, and not all developing economies are home to equity markets that are slumping as mightily as the index. Take the case of India and the WisdomTree India Earnings ETF (EPI C+). EPI, which is one of the most seasoned options among India exchange traded funds, is outpacing the MSCI Emerging Markets Index by nearly 1,600 basis points year-to-date.

The WisdomTree ETF’s annualized volatility this year is also 260 basis points below that of the broader benchmark. In other words, EPI’s less bad showing in 2022 could give way to better things over longer holding periods.

“The Indian economy has shown a remarkable post-COVID recovery, facilitated by government efforts to ease compliance burdens on businesses and remove redundant policies and laws,” noted WisdomTree analyst Hyun Kang. “On August 20, the Ministry of Commerce and Industry announced that it simplified almost 20,000 compliances and decriminalized thousands of laws. The significant reduction in red tape is expected to bolster further outperformance and attract investors.”

Two important factors bode well for Indian equities and EPI. First, stocks in Asia’s third-largest economy have been outpacing broader emerging markets benchmarks for some time. Second, EPI’s relative sturdiness this year arrives against the backdrop of rising oil prices.

“Since the start of Q3 2022, the gap between India’s performance and that of other emerging markets has been widening. The differences are even more glaring when comparing India and China (proxied by the MSCI India and MSCI China indexes, respectively),” added Hang. “India, a major oil importer, has benefited as oil prices have slid over 20% since the middle of June. Lower prices will help tamper inflation and mitigate the need for the Reserve Bank of India to aggressively tighten interest rates—a boon to equities.”

EPI has some avenues for capitalizing on rising commodities prices. For example, the ETF’s underlying index, the WisdomTree India Earnings Index, recently rebalanced and boosted its materials sector exposure in the process.

Another benefit of the EPI methodology is that the index only holds profitable companies — an attractive point at a time when the quality factor is meaningful in emerging markets.

For more news, information, and strategy, visit the Modern Alpha Channel.

Loading Articles...
Our Sites
  • VettaFi
  • Advisor Perspectives
  • ETF Trends
Tools
  • ETF Screener
  • Mutual Fund to ETF Converter
  • Head-To-Head ETF Comparison
  • ETF Country Exposure Tool
  • ETF Stock Exposure Tool
  • ETF Database Pro
More Tools
  • Financial Advisor & RIA Center
Explore ETFs
  • ETF News
  • ETF Category Reports
  • Premium Articles
  • Alphabetical Listing of ETFs
  • Browse ETFs by ETF Database Category
  • Browse ETFs by Index
  • Browse ETFs by Issuer
  • Compare ETFs
Information
  • Contact Us
  • Terms of Use and Privacy Policy
  • © 2025 VettaFi LLC. All rights reserved.

Advertisement

Is Your Portfolio Positioned With Enough Global Exposure?

ETF Education Channel

How to Allocate Commodities in Portfolios

Tom LydonApr 26, 2022
2022-04-26

A long-running debate in asset allocation circles is how much of a portfolio an investor should...

Core Strategies Channel

Why ETFs Experience Limit Up/Down Protections

Karrie GordonMay 13, 2022
2022-05-13

In a digital age where information moves in milliseconds and millions of participants can transact...

}
X