EEM Drops To 10th Biggest ETF In June

Outflows and a pullback in Chinese stocks helped drop the emerging markets fund ‘EEM’ to the 10th biggest of all.

Olly
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Managing Editor
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Reviewed by: Olly Ludwig
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Edited by: Olly Ludwig

The iShares MSCI Emerging Markets ETF (EEM | B-97) in June dropped two places to end the first half of 2015 as the 10th biggest ETF in the world. A nearly 4 percent drop in price, led by the ongoing Chinese selloff, plus outflows of more than $1.7 billion were to blame.

Emerging markets have been on the defensive since the U.S. economic recovery began showing staying power, which drove capital flows into the U.S. Those flows accelerated in May 2013 after the Federal Reserve first indicated it would soon begin to bring to a close its extraordinary bond buying designed to keep borrowing costs low and to encourage risk-taking in the stock market.

Throughout the post-crash years, the question of how China will reinvent itself has remained an open one. Its strong equity markets in the past year—particularly on the mainland—look by now like a bubble to some analysts. With China’s sell-off continuing, it looks likely that EEM could drop out of the top 10 when we next take of a snapshot of the ETF industry’s biggest funds. About 23 percent of EEM’s portfolio is in Chinese stocks.

The chart below plots EEM’s price and the price of the ETF market’s biggest China fund, the iShares China Large-Cap ETF (FXI | B-38). The fund focuses on large Hong Kong-listed firms, half of them financials, with nearly all of them run in some way by the Chinese government. FXI is in red and EEM is in black. The other two, in green and blue, trace positive returns last month in Brazil and India, respectively.

The 10 biggest ETFs below made up just over one-quarter of the $2.118 trillion in total U.S.-listed ETF assets at the end of the first half, according to data compiled by ETF.com. EEM ended the month of June with assets of about $29 billion compared with almost $32 billion at the end of May.

Chart courtesy of StockCharts.com

Biggest ETFs As Of July 1, 2015 ($M)

TickerFundIssuerJune 2015
Flows
June 2015
AUM
June 2015
Turnover
SPYSPDR S&P 500SSgA-2,157.63170,512.09532,248.23
IVViShares Core S&P 500BlackRock-966.5567,763.6615,408.52
EFAiShares MSCI EAFEBlackRock2,167.9560,941.3327,488.83
VTIVanguard Total Stock MarketVanguard333.6256,151.795,923.72
VWOVanguard FTSE Emerging MarketsVanguard567.3847,663.9310,899.13
QQQPowerShares QQQInvesco PowerShares843.3838,792.2463,025.73
VOOVanguard S&P 500Vanguard489.8432,281.716,258.19
IWMiShares Russell 2000BlackRock2,722.4529,527.2184,423.50
IWFiShares Russell 1000 GrowthBlackRock29.7229,438.652,628.51
EEMiShares MSCI Emerging MarketsBlackRock-1,734.1229,120.1441,269.90

Biggest ETFs As Of June 1, 2015 ($M)

TickerFundIssuerMay 2015
Flows
May 2015
AUM
May 2015
Turnover
SPYSPDR S&P 500SSgA792.74176,955.64411,708.26
IVViShares Core S&P 500BlackRock74.1570,457.0113,212.69
EFAiShares MSCI EAFEBlackRock1,501.8461,593.4723,917.90
VTIVanguard Total Stock MarketVanguard356.9457,034.524,925.62
VWOVanguard FTSE Emerging MarketsVanguard262.5448,698.948,728.98
QQQPowerShares QQQInvesco PowerShares-1,370.7339,007.9557,952.22
VOOVanguard S&P 500Vanguard767.4432,570.195,151.37
EEMiShares MSCI Emerging MarketsBlackRock-18.7231,904.1536,476.31
IWFiShares Russell 1000 GrowthBlackRock559.2629,940.573,095.83
VEAVanguard FTSE Developed MarketsVanguard671.3828,106.443,041.06





Olly Ludwig is the former managing editor of etf.com. Previously, he was a financial advisor at Morgan Stanley Smith Barney and an editor at Bloomberg News. Before that, Ludwig was a journalist at the Reuters News Agency in New York.