Three Stocks Driving Emerging Markets ETF Performance in AVEM

Core Insights - Many investors have increased their exposure to foreign equities this year, particularly in emerging markets, leading to strong performance and returns [1] - The Avantis Emerging Markets Equities ETF (AVEM) has attracted significant inflows and has outperformed its benchmarks, returning 31.5% year-to-date [3] Fund Overview - AVEM charges a fee of 33 basis points and actively invests in emerging market stocks across all capitalizations, focusing on small-cap firms with strong profits and low valuations while underweighting large caps with low profits [2] - The fund aims to outperform the MSCI Emerging Market IMI Index [2] Performance Metrics - AVEM has returned 31.5% year-to-date, surpassing the ETF Database Category average of 24.3% and the Factset Segment average of 24.5% as of October 7th [3] - The fund has seen inflows exceeding $4 billion year-to-date [3] Key Holdings - Tencent Holdings (TCEHY) has returned 62.2% year-to-date, making it a significant part of many emerging market strategies [4] - Reliance Industries (RELIANCE) has returned 13.4% year-to-date, benefiting from its diverse exposure across multiple sectors [5] - NetEase (NTES) has shown strong performance with a 73% return year-to-date, operating major games in China for Western developers [6] Strategic Implications - AVEM's active management and adaptability may enhance returns in emerging markets, particularly in response to trends like currency fluctuations and interest rate cuts [6] - The ETF could be a valuable addition for investors looking to diversify their equity allocations beyond U.S. markets [6]