Emerging Markets Internet ETF Debuts

New fund competes directly with the well-established "EMQQ."

Reviewed by: Heather Bell
Edited by: Heather Bell

Today, Global X has rolled out an ETF that will compete with a key existing fund. The Global X Emerging Markets Internet & E-Commerce ETF (EWEB) goes up against the $1.3 billion Emerging Markets Internet & Ecommerce ETF (EMQQ).

EWEB comes with an expense ratio of 0.65% and lists on the Nasdaq stock exchange.

“There is a convergence of themes playing out in emerging markets that’s accelerating consumers’ engagement with online platforms,” said Global X Research Analyst Chelsea Rodstrom.

“Education, wages, consumption, and internet connectivity are all increasing in tandem with emerging markets’ economic development,” she added.

The  fund tracks the Nasdaq CTA Emerging Markets Internet & E-commerce Net Total Return Index, which draws its components from emerging market companies that derive at least half of their revenue, operating income or assets from internet-related services, e-commerce or the electronically delivered software. The index is weighted by modified market capitalization designed to keep large companies from dominating the index, and includes 50 components, according to the prospectus.

Global X notes in a press release that 74% of global growth in 2018 came from emerging market economies, with emerging economies expected to represent 84% of global consumption within a three-year window.

With the addition of EWEB, Global X has a lineup of 24 thematic growth ETFs that have amassed a total of roughly $7 billion in assets under management. EWEB’s competitor EMQQ launched in 2014 and currently has 82 holdings. Its expense ratio of 0.86% is 21 basis points more than that of EWEB. Interestingly, the two ETFs have nine of their top 10 holdings in common.

Contact Heather Bell at [email protected]

Heather Bell is a former managing editor of etf.com. She has also held editorial positions at Dow Jones Indexes and Lehman Brothers. Bell is a graduate of Dartmouth college and resides in the Denver area with her two dogs.