Time for Emerging Markets ETFs?

Core Insights - Emerging-market stocks have achieved their longest winning streak since 2004, with nine consecutive months of gains driven by strong demand for Asian technology shares and increasing inflows [1][2] - The iShares MSCI Emerging Markets ETF (EEM) has gained 29.5% year-to-date and 8.1% in the past month, outperforming the S&P 500's 14.5% year-to-date gains and 4% monthly increase [2] Valuation and Performance - Emerging markets are currently undervalued, with EEM's 36-month P/E at 16.33X compared to 19.25X for Invesco S&P 500 Equal Weight ETF (RSP) and 24.43X for SPDR S&P 500 ETF (SPY) [3] - Several emerging market ETFs have shown strong performance, with low P/E ratios and significant market values, indicating potential investment opportunities [8] Economic Factors - A weak dollar, Federal Reserve rate cuts, and a rally in Chinese tech shares are contributing to the positive performance of emerging market stocks [2][4] - Declines in consumer-price growth across developing nations, including deflation in China, have reduced the need for rate hikes, further supporting emerging market growth [5] Technology Sector - Asian technology stocks are experiencing a surge due to optimism surrounding AI innovation, with Chinese equities still having room for growth as global investors remain under-invested [6][7] - China's significant investments in AI and the "AI Plus" plan are expected to bolster the technology sector, with Chinese tech stocks being cheaper than their U.S. counterparts [7] ETF Highlights - iShares Emerging Markets Dividend ETF (DVYE) has a 36-month P/E of 8.30X and a year-to-date performance of 20% with a market value of $939.1 million [9] - Cambria Emerging Shareholder Yield ETF (EYLD) has a 36-month P/E of 8.97X and a year-to-date performance of 21.5% with a market value of $569.0 million [10] - Schwab Fundamental Emerging Markets Equity ETF (FNDE) has a 36-month P/E of 9.99X and a year-to-date performance of 25.1% with a market value of $7.77 billion [10]