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BMO MSCI Emerging Markets Index ETF (ZEM)
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iShares Core MSCI Emerging Markets IMI Index ETF (XEC)
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Vanguard FTSE Emerging Markets All Cap Index ETF (VEE)
Q: Dear 5i
Is now a good time to invest in the emerging markets ? I'm considering ZEM , VEE , and XEC .Which would you recommend for an RRSP account? Do you really think there is a major shift to small cap stocks currently and if so do you see it continuing for awhile ?
Thanks
Bill C
Is now a good time to invest in the emerging markets ? I'm considering ZEM , VEE , and XEC .Which would you recommend for an RRSP account? Do you really think there is a major shift to small cap stocks currently and if so do you see it continuing for awhile ?
Thanks
Bill C
5i Research Answer:
Thursday saw the biggest reversal shift into small caps in two years. But one day does not make a trend. Still, small caps are very cheap and if the stock market rally broadens we would expect them to do well. Yesterday was fun for those in the sector, certainly. We think it still makes sense to have some emerging market exposure. Investors have avoided the area, but markets are cheap and growth potential is still high, given enough time. Emerging markets are not needed by all investors, but can diversify and provide growth. A weaker US dollar would help, and if interest rates move lower this may happen. The five year performance of the three ETFs noted is nearly identical. We would lean to VEE today.