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High expense ratios pose a sizable hurdle to overcome in the fund's performance. Also VAESX carries a 5% front load. The institutional share is no-load but it requires $100k at Fidelity.
May want to consider international small cap funds which often have 10-20% EM small exposure. Matthews Asia Small Companies come to mind. Grandeur Peaks and Wasatch are good companies to research, but pay attention to the ERs.
Agreed VAESX and WAEMX have high ER's. VAESX at 1.85 and WAEMX art 1.95 but their performance has been good. I prefer VAESX of the 2, M*5 vs M*4 for WAEMX.
While not small cap, I encourage you to take a look at FSEAX which is exclusively focused on Asia and has top 10% returns for the past 1, 3, 5, and 10 year time frames for both Asia Ex-Japan and also emerging markets overall. It is the most consistent fund with strong returns that I have found in EM over the long term. Also held up well in the March downturn. Available at Schwab
DFA Emerging Markets Small Cap / 954 Morgan Stanley Inst EMkts Sm C / 1,021 Ashmore Emerging Markets Sm Cp / 1,294 Victory Sophus Emerging Market / 1,376 RBC Emerging Markets Small Cap / 1,385 Silk Invest New Horizons Front / 1,527 AMG TimesSquare Emerging Mkts / 1,586 Virtus KAR Emerging Markets Sm / 1,738 Victory Trivalent Emerging Mkt / 1,774 Templeton Emerging Markets Sma / 1,827
ETFs such as EWX in this case may be better for pure emerging market small exposure, although I think purity is overrated.
"There is pretty much no time period where EEM has outperformed SPY over the past decade when yields have surged. Add to this that EEM is full of tech (sensitive to rates) and we ask ourselves how people can be so bullish the relative EEM long here..."
Full Disclosure: I have no idea what will happen this year, nor could I pick out a map of many of the countries where these funds invest in, I'm thinking many others couldn't either...and I also likely wouldn't want any of my money going into some of these countries either, I don't even buy cat food where ingredients are sourced from some of these countries. No, no thanks, not for me.
FSEAX compared to the others mentioned: VAESX, WAEMX, GPEOX - looks very promising. MEASX ... too much of a slump... I may have to look further into FSEAX. Up 5.50 ytd BTW.
BCSVX is an interesting share. One I will add to my watch list. This is probably too much of a generalization but... Emerging Markets is a riskier area. Now add Small Cap to it... a bit more risky. So, when I look at 10 plus years of returns on these funds it seems like none of them beat the S&P 500 and they all have a high Ulcer and low Martin and many have high ER. So, why do I own some FPADX? I will compare to FSEAX and BCSVX and perhaps transfer to one of those or out of EM completely myself. I guess I'm repeating what Baseball Fan said above.
@jimlenz Just curious. ARTYX is a great fund with what seems like lower risk. I'm wondering what gets you to add MDDCX vs. adding more to ARTYX? Lower turnover? First one's manager tenure is longer but MDDCX is up in the short YTD ... so I'm just curious if you would mind sharing.
@JonGaltill: BCSVX is not an EM fund, but it is a small-mid cap international fund that follows the Brown Capital process for selecting stocks of companies that "will make a difference." The domestic version, BCSIX, and BCSVX are heavily weighted in technology and healthcare. I own both of these, as well as the aforementioned ARTYX, an EM fund that holds some US companies.
@JonGaltlll: As much as I like ARTYX, I have 10% of my IRA already in there. Figured I would try a pure EM fund. MDDCX has good short term results after change in managers a couple years ago. ARTYX is incredible and hope it keeps going.
Just want to say thank you to the board here. I didn't know the first thing about ARTYX until I found MFO. I had a modest position in FPADX and it was moving along just "fine". After reading a ton of articles / stories about EM and Small Caps for 2021, I knew I needed to pay a little more attention. Researched ARTYX and FSEAX and bought both. Truth be told, in the past, I would have dismissed ARTYX due to ER and life of fund - prefer longer track records.
I am in both ARTYX and FSEAX and could not be happier. ARTYX is up 17.30% and FSEAX is up 16.63% YTD. So thanks to the posters here for sharing.
Comments
FSCOX is not EM, but is international small-caps.
MEGMX is EM, but not small-caps. And it's brand new. $44M AUM.
It's all-cap, "company-first." Macro stuff is not a big priority.
Sorry, I looked at several. I own PRIDX, but it's been closed. Keep tabs on it. It's a gooder "smid" cap fund. Mostly Middle-cap.
May want to consider international small cap funds which often have 10-20% EM small exposure. Matthews Asia Small Companies come to mind. Grandeur Peaks and Wasatch are good companies to research, but pay attention to the ERs.
I'm considering also Matthews Emerging Asia - MEASX, $1b mkt cap
GPEOX (I had it in the past, but then later sold it. Still hold their GPGOX)
WAEMX - Remember it as a high-flier during its early days
WESNX
There are not many you find in that space. If you are open for ETFs, then you may have more options.
The fund performed exceedingly well within its category the first three full calendar years.
12-31-2016
3 Yr return: 10.9% (top 2% of category);
standard deviation of 8.91%
MEASX seems to be in a slump since 2017.
05-31-2020
3 Yr return: -13.8% (bottom percentile); 5 Yr return: -4.0% (bottom percentile);
standard deviation of 21.40%
Note: Morningstar moved MEASX from the 'Pacific/Asia ex-Japan Stock' category
to the 'Miscellaneous Region' category sometime after May 31, 2020.
DFA Emerging Markets Small Cap / 954
Morgan Stanley Inst EMkts Sm C / 1,021
Ashmore Emerging Markets Sm Cp / 1,294
Victory Sophus Emerging Market / 1,376
RBC Emerging Markets Small Cap / 1,385
Silk Invest New Horizons Front / 1,527
AMG TimesSquare Emerging Mkts / 1,586
Virtus KAR Emerging Markets Sm / 1,738
Victory Trivalent Emerging Mkt / 1,774
Templeton Emerging Markets Sma / 1,827
ETFs such as EWX in this case may be better for pure emerging market small exposure, although I think purity is overrated.
"There is pretty much no time period where EEM has outperformed SPY over the past decade when yields have surged. Add to this that EEM is full of tech (sensitive to rates) and we ask ourselves how people can be so bullish the relative EEM long here..."
Full Disclosure: I have no idea what will happen this year, nor could I pick out a map of many of the countries where these funds invest in, I'm thinking many others couldn't either...and I also likely wouldn't want any of my money going into some of these countries either, I don't even buy cat food where ingredients are sourced from some of these countries. No, no thanks, not for me.
Good Luck to all,
Baseball_Fan
I am in both ARTYX and FSEAX and could not be happier. ARTYX is up 17.30% and FSEAX is up 16.63% YTD. So thanks to the posters here for sharing.