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Need advice re diversified EM fund

edited April 2012 in Fund Discussions
Ladies and Gentlemen, I need something to complement MAPIX and replace FEMEX & MGEMX. Both open-end and closed-end fund suggestions are solicited. EM Equities only. The requirement is for diversification, so no Asia-centric please. i considered EMF until I realized that its success owed pretty much to the outsized Asia exposure. Go figure.


  • Take a look at WAEMX. If you want complement it with an large cap centric etf such as VWO or EEM
  • Hi fundalarm,

    I find that WAEMX is closed to new investors; at least per Fido.

    However, you may have already looked at this; but a consideration, too.
    FTEMX , being a new Fido offering, but with manager John Carlson (FNMIX manager) also involved in this fund. This offering that could be called a G&I or EM balanced fund, too.
    --- nominally 60% equity/40% bonds
    --- broad equity spread from mega to small cap
    --- 310 holdings, top ten are about 15% of total
    --- 10 sector areas
    --- yield about 1.8%
    --- some Asia, but is spread out globally, too

    I didn't compare this to your noted MGEMX.
    This is the Fido composition link, which also has a prospectus link.

    Happy hunting,
  • Reply to @catch22: thanks, Mark. this one looks interesting despite having bonds in it (i am pretty happy with my GIM position). I'll take a closer look.
  • Reply to @fundalarm:
    Fido also has this newer offering FEDDX.
  • beebee
    edited April 2012
    Hi FA,

    I own WAEMX and PRIDX. Long term they both seem to have lower downside risk.I came across this newly minted international small cap fund from TCW,TGNIX.
    Might be worth a look:

    "TGNIX invests in small-cap companies located outside of the United States. It generally targets companies with market capitalization of $6 billion or less at the time of purchase across both developed and emerging markets."

    Manager Rohit Sah left Oppenheimer where he managed OSMAX. Here's his TCW welcome bio:

    Rohit Sah to Discuss Opportunities in International Small Cap Stocks on Conference Call:

    Here's the replay of this conference call:
  • My diversified EM funds are ARMGX, EITEX, ABEMX and ODVYX.
    But all of them are heavily invested in Asia (40-60%).
  • FEO would be a balanced option. I've been disappointed with Pimco's new EM offerings.
  • edited April 2012
    Reply to @catch22: I did not track FEDDX as it is very new fund but it could be an alternative to WAEMX. Like WAEMX it is more focused to Consumer in emerging markets. Still 25% is Asia emerging, 39% Asia Developed. I do not think fundalarm would like that exposure.
  • Hi there FA- checked the international holdings in our American Fund accounts but found (as I expected) nothing much for you there. Would have been front load anyway, and we can sure do without that.

    Good luck!
  • Reply to @Investor:
    I agree with the consumer side of these type funds. I recall a thread several months ago about this topic for the Asia and Latin markets in particular.
  • thank you, all. i'll check those mentioned.
  • edited April 2012
    I'm a little late to the thread with this thought, but I've started looking at two new low-volatility EM etf's: PowerShares' EELV and iShares EEMV. Of the two, at first glance I like EEMV a little better because it has rules in place to keep sector and country weights from going really far afield from the cap indexes.

    For example, in EELV, with no such sideboard rules in place, the top country holding is Malaysia at 25% vs. 2% for the broad index, and is pretty much missing some sectors altogether, such as tech. EEMV, on the other hand, has country and sector weights that are, while with plenty of over- and under-weights, not so over and under that any component is 10x the index.

    The usual recommended EM etf, the dividend-weighted DEM, is great too, but I think at least EEMV has the potential to deliver good returns without quite as much downside risk.
  • We use ODMAX (available at NAV in some places) as our main diversified EM fund. I am not willing to entrust dollars to an index, since most of them have very little in some of the fastest-growing and most important economies. And I do believe that there are more than enough inefficiencies in the EM area that good managers can do better than the index. ODMAX is evidence of that. We also use MAPIX as a lower-risk way to gain exposure to some Asian markets, but the fund owns 35-40% in developed markets of Japan, Australia, etc. LZOEX has been an ok option in this area and is worth a look. I do like, and own, WAEMX, but it will carry too much risk for some folks. But the fund managers are great stock pickers and they have virtually all of their own dollars tied up in the funds they manage, a good sign. Personally I prefer to let the managers go with their best ideas and not be constrained by any index weightings. Fidelity has had pretty weak international stock funds given its ability in other areas, so I would not look there until something big changes.
  • Just another view here: many of the indexes used by etf's are custom-built and fundamentally weighted, which research by Arnott & Co. among others has shown to earn a premium over traditional cap-weighted indexes. The best EM etf's combine fundamental approaches with low costs, imho, into attractive and competitive packages. For just one example (which of course doesn't prove much of anything, but may be of interest): since the inception of DEM in late 2007, $10k invested there vs. $10k in ODMAX has grown to $14,560 for DEM vs. $12,830 for ODMAX (source: Morningstar chart function).

    FWIW, AJ

  • thanks again -- all. just like with any illiquid market, i am looking for an actively managed fund, not an ETF. ETFs are great -- until there is stress in the market. i'll try to exlore getting odmax on the cheap -- the fund seems to fit the bill nicely. waemx has been closed for several months, but i am one of those who doesn't strive in extreme volatility and thus small cap EM stocks are not an asset class of my choice. thanks for all of your contributions, and keep them coming!
  • Some of us remember and greatly appreciate all of your help and suggestions over the years. What goes around...
  • edited April 2012
    Reply to @fundalarm: I agree that's a good choice, but on the point about etf's not working when there's stress in the market, I have to toss in another data point. In '08: DEM -34.58%; ODMAX -48.03%. DEM's lesser loss in '08 had a good bit to do with its 5-year-ish return advantage over ODMAX.

    It depends on the etf; they come in a lot of different flavors.

  • Reply to @AndyJ: point well taken, Andy. there is more to it than meets the eye. requires more study.
  • Reply to @fundalarm: That's the thing with etf's: there are so many of them, and it takes a lot of effort to drill down and see what they're each doing.
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