VTI - EEM ETF: Best To Wait On The Sidelines For Now

2024-04-18 07:04:33 ET

Summary

• EEM has only delivered single-digit returns over the past year, underperforming global stocks, and we don't believe this trend will shift any time soon.
• Conditions for dollar appreciation look rather strong.
• EEM is not very cost-efficient relative to its peers.
• EEM's top geographic region-China is suffering from weak domestic conditions, and the trade angle too could be disrupted as relations with its notable partner-the EU aren't on a great footing.
• The weekly charts suggest that it may not be a great time to pursue EEM.

Introduction

The iShares MSCI Emerging Markets ETF ( EEM ), is a $17bn sized, two-decade-old product that focuses on over 1200 emerging market stocks from 24 different countries. Over the past year, EEM hasn’t really made a great deal of progress, eking out marginal gains of less than 3%; conversely, global stocks have generated healthy returns of over 16% during the same time period....

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