Best Emerging Markets ETFs: Low-Cost EM Index Funds
When MSCI launched its Emerging Markets Index in 1988, it covered just 10 countries representing less than 1% of world market capitalization. That index now spans 24 countries and captures roughly 85% of the free float-adjusted market cap in each one — a measure of how far emerging markets ETFs have come as an asset class.
The two dominant benchmarks behind most emerging markets ETFs — the MSCI Emerging Markets Index and the FTSE Emerging Markets Index — differ in one surprisingly consequential way: South Korea. MSCI classifies South Korea as an emerging market, while FTSE treats it as developed. That means choosing between VWO (which tracks FTSE) and IEMG (which tracks MSCI) is also an implicit bet on whether South Korea belongs in the portfolio.
Notable emerging markets ETFs include:
- VWO — Vanguard FTSE Emerging Markets ETF: Launched in 2005, holds over 6,000 stocks, excludes South Korea. Also available as a mutual fund (VEMAX).
- IEMG — iShares Core MSCI Emerging Markets ETF: Launched in 2012, holds more than 2,600 stocks across large-, mid-, and small-cap companies, covering approximately 99% of EM free float market cap. Includes South Korea.
- EEM — iShares MSCI Emerging Markets ETF: One of the oldest in the category, launched in 2003, holding approximately 1,200 large- and mid-cap stocks. Carries a notably higher expense ratio than newer alternatives.
- SPEM — SPDR Portfolio Emerging Markets ETF: Tracks the S&P Emerging Markets BMI Index with approximately 2,987 holdings. Excludes South Korea, similar to VWO.
Top country exposures across these funds typically include China, Taiwan, India, and — depending on the benchmark — South Korea. Sector weightings lean toward financials, information technology, consumer discretionary, and communication services. The three major providers — Vanguard, BlackRock (iShares), and State Street (SPDR) — each use a different index family, so holdings and country allocations vary more than the broad “emerging markets” label suggests.
The MSCI and FTSE indices are reviewed quarterly, and countries have been added and removed over the years based on criteria around economic development, market size, liquidity, and accessibility. The cost difference between the cheapest and most expensive major EM ETFs can be tenfold — a significant filter when selecting a fund for long-term holding.
Regulated brokerThe table below lists emerging markets stock and index ETFs with live data on fees, performance, and fund structure.
| Stock | Price | Change % | 52 Week Range |
|---|---|---|---|
| $81.47 | 1.31% | ||
| $60.21 | 0.89% | ||
| $66.59 | 1.33% | ||
| $95.90 | 0.38% | ||
| $95.57 | 1.47% | ||
| $52.34 | 0.91% | ||
| $36.61 | 0.89% | ||
| $41.18 | 1.34% | ||
| $66.94 | 0.33% | ||
| $72.26 | 1.05% | ||
| $53.20 | 1.26% | ||
| $39.42 | 1.20% | ||
| $40.12 | 1.04% | ||
| $53.68 | 1.18% | ||
| $25.63 | 0.00% | ||
| $64.96 | 0.85% | ||
| $47.23 | 1.21% | ||
| $21.09 | 0.05% | ||
| $21.61 | 0.37% | ||
| $29.18 | 0.98% | ||
| $49.39 | 1.44% | ||
| $61.12 | 1.58% | ||
| $50.32 | 1.39% | ||
| $74.43 | 0.53% | ||
| $35.22 | 1.21% | ||
| $39.47 | 1.00% | ||
| $71.25 | 1.37% | ||
| $41.34 | 1.05% | ||
| $40.05 | 0.40% | ||
| $76.62 | 1.25% | ||
| $29.09 | 0.55% | ||
| $33.29 | 1.30% | ||
| $42.12 | 0.02% | ||
| $45.73 | 0.15% | ||
| $41.57 | 0.19% | ||
| $34.65 | 0.99% | ||
| $77.96 | 1.19% | ||
| $40.42 | 0.25% | ||
| $45.69 | 2.08% | ||
| $48.43 | 1.77% | ||
| $65.91 | 0.90% | ||
| $25.32 | 0.31% | ||
| $43.60 | 1.15% | ||
| $42.02 | 0.86% | ||
| $77.03 | 1.30% | ||
| $48.79 | 1.07% | ||
| $44.78 | 0.27% | ||
| $40.98 | 1.16% | ||
| $61.22 | 0.56% | ||
| $42.52 | 1.17% | ||
| $36.70 | 1.40% | ||
| $36.09 | 0.06% | ||
| $29.66 | 0.07% | ||
| $23.82 | 0.15% | ||
| $39.41 | 1.43% | ||
| $31.67 | 1.05% | ||
| $68.54 | 1.29% | ||
| $28.26 | 1.31% | ||
| $92.60 | 1.42% | ||
| $28.42 | 1.49% | ||
| $39.28 | 1.21% | ||
| $30.92 | 0.21% | ||
| $87.56 | 4.04% | ||
| $42.79 | 0.18% | ||
| $52.13 | 1.26% | ||
| $28.93 | 0.33% | ||
| $32.99 | 0.58% | ||
| $48.84 | 1.30% | ||
| $55.44 | 1.07% | ||
| $42.75 | 0.58% | ||
| $78.33 | 1.02% | ||
| $36.23 | 0.93% | ||
| $33.98 | 1.51% | ||
| $42.15 | 0.38% | ||
| $44.16 | 1.75% | ||
| $66.26 | 0.47% | ||
| $29.00 | 1.26% | ||
| $47.93 | 1.54% | ||
| $32.58 | 1.89% | ||
| $79.45 | 1.31% | ||
| $15.45 | 0.16% | ||
| $34.01 | 0.23% | ||
| $63.37 | 0.79% | ||
| $93.98 | 0.84% | ||
| $39.18 | 0.08% | ||
| $22.48 | 1.09% | ||
| $12.05 | 1.30% | ||
| $27.79 | 0.50% | ||
| $25.10 | 1.03% | ||
| $43.06 | 1.85% | ||
| $46.56 | 1.35% | ||
| $37.27 | 0.96% | ||
| $39.79 | 1.79% | ||
| $28.78 | 1.42% | ||
| $35.22 | 0.43% | ||
| $113.59 | 2.84% | ||
| $56.43 | 1.05% | ||
| $17.73 | 3.87% | ||
| $18.64 | 0.00% | ||
| $16.33 | 1.37% | ||
| $25.28 | 2.17% | ||
| $46.95 | 1.39% | ||
| $71.98 | 1.15% | ||
| $41.30 | 1.36% | ||
| $47.53 | 0.69% | ||
| $33.35 | 1.17% | ||
| $22.14 | 2.16% | ||
| $20.09 | 0.02% | ||
| $19.56 | 0.20% | ||
| $12.10 | 2.74% | ||
| $28.32 | 0.87% | ||
| $16.10 | 0.20% | ||
| $21.49 | 0.05% |
