Emerging Markets Still A Good Investment Despite Warning Notices Regarding Russia

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Many investors in emerging market funds got a message from the fund warning that turmoil in relations between the United States and Russia could effect fund assets or performance. Notices looked something like this:

SSEMX Warning Notice Regarding Russia

According to this news report:

U.S. securities regulators contacted fund firms with holdings in Russia last month, to make sure they were properly managing risk and disclosing the assets to investors.

I don’t believe the Kremlin’s Propaganda but neither do I think the United State’s handling of affairs has been stellar.

But we do think that, despite the risks, emerging markets is still a good investment. Russia represents a small portion of the typical emerging market fund:

  • 5.14% of iShares MSCI Emerging Markets ETF (EEM)
  • 5.8% of FTSE Emerging Markets ETF (VWO)

 

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David John Marotta is the Founder and President of Marotta Wealth Management. He played for the State Department chess team at age 11, graduated from Stanford, taught Computer and Information Science, and still loves math and strategy games. Favorite number: e (2.7182818...)