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For investors seeking momentum, iShares MSCI Emerging Markets ETF (EEM - Free Report) is probably on radar. The fund just hit a 52-week high and is up 84% from its 52-week low of $30.10 per share.
But are more gains in store for this ETF? Let’s take a quick look at the fund and the near-term outlook on it to get a better idea on where it might be headed.
EEM in Focus
This ETF offers exposure to a broad range of emerging market companies. It has key holdings in information technology, consumer discretionary, financials and communication. Among the emerging countries, China takes the top spot at nearly 39% share while South Korea and Taiwan round off the next two spots with a double-digit exposure each. The fund charges 70 bps in fees per year (see: all the Broad Emerging Market ETFs here).
Why the Move?
The emerging markets have been an area to watch lately given their outperformance over the past few months. The super-easy policies, wider rollout of COVID-19 vaccines and Joe Biden heading to White House have bolstered confidence in riskier assets. The administration is looking for a bigger fiscal package and infrastructure spending that would lead to increased demand for metals and industrial products from companies in the emerging markets.
More Gains Ahead?
Currently, EEM has a Zacks ETF Rank #3 (Hold) with a Medium risk outlook. Therefore, it is hard to get a handle on its future returns one way or the other. However, many of the segments that make up this ETF have a strong Zacks Industry Rank. So, there is definitely some promise for those who want to ride this surging ETF a little further.
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Emerging Market ETF (EEM) Hits New 52-Week High
For investors seeking momentum, iShares MSCI Emerging Markets ETF (EEM - Free Report) is probably on radar. The fund just hit a 52-week high and is up 84% from its 52-week low of $30.10 per share.
But are more gains in store for this ETF? Let’s take a quick look at the fund and the near-term outlook on it to get a better idea on where it might be headed.
EEM in Focus
This ETF offers exposure to a broad range of emerging market companies. It has key holdings in information technology, consumer discretionary, financials and communication. Among the emerging countries, China takes the top spot at nearly 39% share while South Korea and Taiwan round off the next two spots with a double-digit exposure each. The fund charges 70 bps in fees per year (see: all the Broad Emerging Market ETFs here).
Why the Move?
The emerging markets have been an area to watch lately given their outperformance over the past few months. The super-easy policies, wider rollout of COVID-19 vaccines and Joe Biden heading to White House have bolstered confidence in riskier assets. The administration is looking for a bigger fiscal package and infrastructure spending that would lead to increased demand for metals and industrial products from companies in the emerging markets.
More Gains Ahead?
Currently, EEM has a Zacks ETF Rank #3 (Hold) with a Medium risk outlook. Therefore, it is hard to get a handle on its future returns one way or the other. However, many of the segments that make up this ETF have a strong Zacks Industry Rank. So, there is definitely some promise for those who want to ride this surging ETF a little further.
Want key ETF info delivered straight to your inbox?
Zacks’ free Fund Newsletter will brief you on top news and analysis, as well as top-performing ETFs, each week. Get it free >>