Posted: 9/29/2007 1:13:53 AM EDT
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I got into an Emerging Markets fund in 2006. The rate of return has been great for TWMIX. I have this in a Roth IRA for maximum returns. 2006, 42 % 2007, over 36 % YTD 3-year average, 42 % |
one of the least expensive (in terms of ER) and most diversified instruments for capturing emerging markets (i.e., primariy "BRIC" -- brazil, russia, india, and china) is the Vanguard ETF "VWO". profile finance.yahoo.com/q/pr?s=VWO performance finance.yahoo.com/q/pm?s=VWO related info seekingalpha.com/symbol/vwo interesting articles Why VWO Is the Better Emerging Market ETF ar-jedi disclaimer -- i've had a position in VWO since mid-2005. |
| I plan to add some VWO to my IRA. I took the advice of AR-Jedi and added an overseas ETF a couple months ago. I had no foreign holdings, so I bought VEA it's a large cap fund with a very low ER. It's been the top perfoming fund in my IRA. I just wish I had bought it sooner. |
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Vanguard VEIEX is the OEF (open ended [mutual] fund) counterpart to the Vanguard ETF VWO. over the long term, they *should* track each other prefectly. again, use ETF's when you lump sum invest in taxable accountts, and use mutual funds when you dollar cost average in tax-advantaged accounts (401k, 403b, IRA, Roth IRA, etc). over the short term (daily) there will be tracking error between VEIEX and VWO due to the fact that OEF NAVs are computed once per day, and ETF NAVs are computed whenever the market is open. moreover, the constituent stocks are traded way outside our "normal" trading hours, so at US market open there will be generally be a step up or down in VWO pricing. ar-jedi |
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I know this is about emerging markets only but please bear with me. I've got a fair amount of my portfolio in VEIEX (both taxed and non-taxed accts) and FDIVX (401k). I've been in both of them for a few years (12 years with FDIVX) and have been happy with the performance of both as they fit well within my portfolio. However I'm getting a little nervous because the emerging markets in particular have been hot lately and on the covers of magazines, etc. This is usually a bad sign as the new money floods in chasing returns just in time for them to crap out. But I'm torn because our current US monetary policy is basically all about keeping a weak dollar and with the growth in non-US markets I just cannot see anything in the near term (1-2 years) that is going to take the wind out of the emerging and foreign markets (barring global meltdown). I considered doing some profit-taking but I just don't know where else I'd put the money as nothing else is particularly appealing right now. Curious to see what others thoughts on the subject are. Thoughts? |
If you're weary of the developing markets, maybe you can check out a developed markets fund. One example is VIDMX, which I have some money in. I am 14% YTD in this one, and it shows an annual average of about 20% over the last 5 years. Perhaps not as great as the developing markets, but it's doing ok, and is still based on foreign markets (23% UK, 46% western Europe other than UK, plus Japan and a few others) if you want something outside of the dollar. |
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