##  [# Emerging Markets ETF Battered by China Woes to Start 2024 ](/sections/features/emerging-markets-etf-battered-china-woes-start-2024) 

 

# Emerging Markets ETF Battered by China Woes to Start 2024 

 

 

Big China weightings have hurt emerging market ETFs. EMXC, an EM fund focused more on India, has fared better.



 

 

 

 

 [![sumit](/sites/default/files/styles/author_image_icon/public/2023-03/Sumit_0.png?itok=SO-7S5SH "sumit")](/authors/sumit-roy) 

[By Sumit Roy ](/authors/sumit-roy)

 Jan 22, 2024

 Edited by: James Rubin

 

 

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The [**iShares MSCI Emerging Markets ETF (EEM)**](https://www.etf.com/EEM) is off to a rough 2024, losing nearly 5%, mainly due to goings on in China.

EEM allocates a quarter of its portfolio to China and another 16% to Taiwan, or more than 40% between them.

While investors might be surprised to find that China makes up such a large share of EEM, such an allocation isn't unusual among broad emerging markets funds.

The largest ETF in the space, the $75 billion [**Vanguard Emerging Markets Stock Index Fund ETF (VWO)**](/vwo) has an even greater percentage of its portfolio in China—28%—and another 19% in Taiwan. That’s almost half of its portfolio between the two.

For investors who are nervous about such hefty allocations to China at a time of elevated geopolitical and economic risks related to the country, something like the [**iShares MSCI Emerging Markets ex China ETF (EMXC)**](/EMXC) might make sense.

## EMXC Fares Better

EMXC is a broad emerging markets ETF that excludes Chinese stocks, a strategy that’s led to a 2.5% loss this year—or half the loss of EEM.

Over the past year, the outperformance is more stark: EMXC is up 9% versus a 4% decline for EEM. It’s the same story over the past five years: EMXC is up 27% versus a 5% gain for EEM.

EMXC currently has India as its top country, with a 24% allocation to that country. And though it excludes mainland China stocks, it still holds stocks from Taiwan and allocates a chunky 21% of its portfolio to stocks from the island.

Rounding out the top five countries for EMXC are Korea, Brazil and Saudi Arabia, with weightings of 16%, 8% and 6%, respectively.

 
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 [ Sumit Roy Senior ETF Analyst ](/authors/sumit-roy) 

 

 

  Sumit Roy is the senior ETF analyst for etf.com and author of (Don't) Invest Like a Pro. He creates a variety of content for the platform, including…   [View Bio](/authors/sumit-roy)

 



 

 


 Related Topics  [China](http://www.etf.com/topics/china) 

 [Emerging Markets](http://www.etf.com/topics/emerging-markets) 

 [Vanguard](http://www.etf.com/topics/vanguard)