Whether you want to diversify your portfolio or just want to look at other investing opportunities outside of the major stocks, it can be a good idea to consider stocks and funds that are focused on international markets.
One exchange-traded fund (ETF) in particular that has been doing well is the iShares Core MSCI Emerging Markets ETF (NYSE Arca:IEMG). In the past 12 months, its returns are around 36%. Not only has it generated strong gains for investors, but it also pays a dividend that yields an attractive rate of 2.8%, which is far higher than the S&P 500 average of around 1.1%.
This fund seeks long-term growth with 25% of its stocks being based in China, another 21% in Taiwan, 15% in India, and 14% in South Korea. Tech stocks and financials represent close to half of its total holdings. The big names in the ETF include Taiwan Semiconductor Manufacturing, Tencent Holdings, and Samsung Electronics.
What's also attractive about the fund is its expense ratio is fairly low at just 0.09%, making it a suitable long-term option as fees won't take a big chunk out of your overall gains.
The fund's strong rally over the past year could be part of a longer trend as investors start to think twice about highly priced U.S. stocks and pivot to other opportunities where valuations are more attractive and where stocks may have more room to rise higher.
This can be a solid ETF to hold on to if you're worried about too much exposure to tech in North America, or simply to help diversify your portfolio.
