With gross dometic product (GDP) growth in the United States, Europe and the western world slowing down, many investors are trying to find the best ETFs that focus on South East Asia. There are a number of reasons to be optimistic about Southeast Asia. The region is home to some of the fastest growing economies in the world, including Indonesia, Malaysia, Philippines, Singapore, Thailand and Vietnam.
Further, per capita GDP growth has been strong as well. From 2010 to 2016, per capita GDP in South East Asia grew by an average of 4.5% per year. This is significantly faster than the 1.3% annual growth in per capita GDP for the developed world during the same period.
In this guide, we list the 10 best ETFs for investors to get exposure to the rapidly growing economies.
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1. iShares MSCI Emerging Markets Asia Index ETF (EEMA)
The iShares MSCI Emerging Markets Asia Index ETF seeks to track the investment results of an index composed of large- and mid-capitalization Asian companies that are publicly traded in local markets and denominated in their local currencies.
The Fund will invest at least 90% of its assets in the securities of its underlying index and in depositary receipts representing securities of its underlying index. The Underlying Index is a free float-adjusted market capitalization weighted index designed to measure equity market performance in the Asian emerging markets.
Country Allocation: China 74.7%, South Korea 12.2%, Taiwan 9.4%, India 2.9%, Malaysia 0.8%.
Top Ten Holdings & Weighting: Taiwan Semiconductor Manufacturing Co., Ltd. (TSM) 6.1%, Samsung Electronics Co., Ltd. (SSNLF) 4.4%, China Mobile Limited (CHL) 4.4%, Industrial and Commercial Bank of China Limited (1398.HK) 4.3%, AIA Group Limited (1299.HK) 3.5%, China Construction Bank Corporation (601939.SS) 3.4%, Alibaba Group Holding Limited (BABA) 3.2%, Tencent Holdings Limited (700.HK) 2.8%, Ping An Insurance (Group) Company of China, Ltd. (601318.SS) 2.8%, China Life Insurance Company Limited (601628.SS) 2.4%.
2. SPDR S&P China ETF (GXC)
The SPDR S&P China ETF seeks to track the total return performance of the S&P China BMI Index.
The S&P China BMI Index is a broad-based, market cap-weighted index that comprises commonly traded stocks in the Chinese equity market. The Index covers approximately 85% of the Chinese equity universe and is designed to provide investors with a comprehensive and representative benchmark for Chinese equity markets.
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Country Allocation: China 100%.
Top Ten Holdings & Weighting: Ping An Insurance (Group) Company of China, Ltd. (601318.SS) 6.2%, Alibaba Group Holding Limited (BABA) 5.7%, China Construction Bank Corporation (601939.SS) 4.4%, Industrial and Commercial Bank of China Limited (1398.HK) 4.2%, China Life Insurance Company Limited (601628.SS) 3.7%, Baidu, Inc. (BIDU) 2.8%, China Merchants Bank Co., Ltd. (600036.SS) 2.2%, Agricultural Bank of China Limited (601288.SS) 2.1%, Tencent Holdings Limited (700.HK) 1.9%, CNOOC Limited (0883.HK) 1.8%.
3. Xtrackers Harvest CSI 300 China A-Shares ETF (ASHR)
The Xtrackers Harvest CSI 300 China A-Shares ETF seeks to track the investment results of the CSI 300 Index. The CSI 300 Index is designed to reflect the performance of the large and mid-cap segments of the Chinese securities market. The Index consists of the 300 largest and most liquid Chinese A-Shares listed on the Shenzhen or Shanghai Stock Exchanges.
The Fund invests at least 80% of its total assets in the securities of its underlying index and in depositary receipts representing such securities. The Underlying Index is a market capitalization-weighted index composed of A-shares and B-shares listed on the Shanghai or Shenzhen Stock Exchanges.
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Country Allocation: China 100%.
Top Ten Holdings & Weighting: Industrial and Commercial Bank of China Limited (1398.HK) 5.5%, China Construction Bank Corporation (601939.SS) 5.2%, Ping An Insurance (Group) Company of China, Ltd. (601318.SS) 4.8%, China Merchants Bank Co., Ltd. (600036.SS) 2.3%, Agricultural Bank of China Limited (601288.SS) 2.2%, Baidu, Inc. (BIDU) 1.9%, China Life Insurance Company Limited (601628.SS) 1.8%, Tencent Holdings Limited (700.HK) 1.7%, China Pacific Insurance Group Co., Ltd. (601601.SS) 1.6%, New China Life Insurance Company Limited (601336.SS) 1.5%.
4. iShares MSCI Philippines Index ETF (EPHE)
The iShares MSCI Philippines Index ETF seeks to track the investment results of an index composed of Philippine equities.
The Fund invests at least 90% of its assets in the securities of its underlying index and in depositary receipts representing securities in its underlying index. The Underlying Index is a free float-adjusted market capitalization weighted index that is designed to measure the performance of the large and mid cap segments of the Philippine market.
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Country Allocation: Philippines 100%.
Top Ten Holdings & Weighting: SM Prime Holdings, Inc. (SMPH) 8.6%, Ayala Corporation (AC) 7.7%, JG Summit Holdings, Inc. (JGS) 6.8%, BDO Unibank, Inc. (BDO) 5.4%, Metropolitan Bank & Trust Company (MBT) 3.5%, Globe Telecom, Inc. (GLO) 3.3%, Alliance Global Group, Inc. (AGI) 3.1%, PLDT, Inc. (TEL) 2.9%, Ayala Land, Inc. (ALI) 2.8%, SM Investments Corporation (SM) 2.6%.
5. VanEck Vectors India Small-Cap Index ETF (SCIF)
The VanEck Vectors India Small-Cap Index ETF seeks to track the investment results of the MVIS India Small-Cap Index, a rules-based, modified capitalization-weighted, float-adjusted index that is designed to track the overall performance of publicly traded companies in India that have a market capitalization of between $200 million and $2 billion.
The Fund invests at least 80% of its total assets in the securities of its underlying index and depositary receipts representing securities in its underlying index. The Underlying Index is calculated by MV Index Solutions GmbH (MVIS). MVIS selects companies for inclusion in the Underlying Index that it believes, in combination, create an index with a risk and return profile similar to that of other small-cap equity indices.
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Country Allocation: India 100%.
Top Ten Holdings & Weighting: Bajaj Finance Limited (500034.IN) 2.3%, Tata Consultancy Services Limited (532540.IN) 2.3%, HDFC Bank Limited (500180.IN) 2.2%, Housing Development Finance Corporation Limited (500010.IN) 2.1%, Infosys Limited (500209.IN) 1.9%, Kotak Mahindra Bank Limited (500247.IN) 1.8%, ICICI Bank Limited (532174.IN) 1.7%, Axis Bank Limited (532215.IN) 1.7%, IndusInd Bank Limited (532187.IN) 1.6%, Bajaj Finserv Limited (500034.IN) 1.6%.
6. KraneShares Bosera MSCI China A ETF (KBA)
The KraneShares Bosera MSCI China A ETF seeks to track the investment results of the MSCI China A Index, which captures large and mid-cap representation across Mainland China securities listed on the Shanghai or Shenzhen exchanges.
The Fund invests at least 80% of its total assets in the securities of its underlying index and American depositary receipts ("ADRs"), global depositary receipts ("GDRs"), master limited partnerships ("MLPs") and real estate investment trusts ("REITs") based on the securities in its underlying index. The Underlying Index is designed to track the performance of Mainland China equities that are accessible through the Stock Connect program linking the Shanghai and Hong Kong stock exchanges.
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Country Allocation: China 100%.
Top Ten Holdings & Weighting: Ping An Insurance (Group) Company of China, Ltd. (601318.SS) 5.2%, China Construction Bank Corporation (601939.SS) 4.7%, Industrial & Commercial Bank of China Limited (601398.SS) 3.9%, Bank of China Limited (601988.SS) 3.5%, Agricultural Bank of China Limited (601288.SS) 2.7%, China Merchants Bank Co., Ltd. (600036.SS) 2.4%, AIA Group Limited (1299.HK) 1.9%, China Life Insurance Company Limited (601628.SS) 1.8%, Haitong Securities Co., Ltd. (600837.SH) 1.8%, CNOOC Limited (883.HK) 1.6%.
7. VanEck Vectors Vietnam ETF (VNM)
The VanEck Vectors Vietnam ETF seeks to track the investment results of the MVIS Vietnam Index, a rules-based, modified capitalization-weighted, float-adjusted index that is designed to track the overall performance of publicly traded companies in Vietnam.
The Fund invests at least 80% of its total assets in the securities of its underlying index and depositary receipts representing securities in its underlying index. The Underlying Index is calculated by MV Index Solutions GmbH (MVIS). MVIS selects companies for inclusion in the Underlying Index that it believes, in combination, create an index with a risk and return profile similar to that of other small-cap equity indices.
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Country Allocation: Vietnam 100%.
Top Ten Holdings & Weighting: Vietcombank (VCB.HM) 4.9%, Vinamilk (VNM.HM) 4.8%, Military Bank (MBB.HM) 3.5%, VietinBank (CTG.HM) 2.7%, Sacombank (STB.HM) 2.6%, PetroVietnam Gas Corporation (GAS.HM) 2.2%, Masan Group Corporation (MSN.HM) 1.9%, Petrovietnam Technical Services Corporation (PVS.HM) 1.8%, Vinh Hoan Corporation (VHC.HM) 1.8%, BIDV Insurance Corporation (BIC.HM) 1.7%.
8. First Trust Southeast Asia ETF (FSEA)
The First Trust Southeast Asia ETF seeks investment results that correspond generally to the price and yield (before the Fund's fees and expenses) of an equity index called the Alphashares Southeast Asia Index.
The Fund will normally invest at least 90% of its net assets (plus any borrowings for investment purposes) in common stocks that comprise the Index. The Index is a free float adjusted market capitalization weighted index designed to measure publicly traded companies domiciled in Indonesia, Malaysia, Philippines, Singapore, Thailand or Vietnam.
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Country Allocation: Indonesia 26.3%, Malaysia 24.2%, Philippines 19.7%, Singapore 16.8%, Thailand 9.5%, Vietnam 3.5%.
Top Ten Holdings & Weighting: Singapore Telecommunications Limited (SGAPY) 6.1%, AIA Group Limited (AAIGF) 5.4%, DBS Group Holdings Ltd (DBSDY) 4.2%, Oversea-Chinese Banking Corporation Limited (OCBC) 3.3%, United Overseas Bank Limited (UOVEY) 2.9%, Bangkok Bank Public Company Limited (BKKBY) 2.8%, City Developments Limited (CDEVY) 2.6%, CapitaLand Commercial Trust (CCTLY) 1.9%, Keppel Corporation Limited (KPELY) 1.7%, Hutchison Port Holdings Trust (HPHTU) 1.6%.
9. Global X MSCI Pakistan ETF (PAK)
The Global X MSCI Pakistan ETF seeks to invest in large- and mid-cap Pakistani equities that are traded on the Pakistan Stock Exchange and that are included in the MSCI Pakistan Index. The index covers approximately 85% of the available market capitalization in Pakistan.
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Country Allocation: Pakistan 100%.
Top Ten Holdings & Weighting: Habib Bank Limited (HBL.PK) 9.4%, United Bank Limited (UBL.PK) 8.1%, National Bank of Pakistan (NBP.PK) 5.0%, MCB Bank Limited (MCB.PK) 4.6%, Lucky Cement Limited (LUCK.PK) 4.1%, Engro Corporation Limited (ENGRO.PK) 3.7%, Pakistan State Oil Company Limited (PSO.PK) 2.4%, Pakistan Petroleum Limited (PPL.PK) 2.2%, Hub Power Company Limited (HUBC.PK) 1.9%, Oil & Gas Development Company Limited (OGDC.PK) 1.8%.
10. iShares MSCI All Country Asia ex Japan Index ETF (AAXJ)
The iShares MSCI All Country Asia ex Japan Index ETF seeks to track the investment results of an index composed of large- and mid-capitalization non-Japanese equities publicly traded in developed and emerging markets across Asia.
The Fund invests at least 90% of its assets in securities of its underlying index and depositary receipts representing securities in its underlying index. The Underlying Index is a free float-adjusted market capitalization weighted index that seeks to measure the equity market performance of 23 Asian Pacific economies, excluding Japan.
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Country Allocation: Australia 9.0%, China A-shares 4.8%, Hong Kong 28.9%, India 16.7%, Indonesia 7.2%, South Korea 15.6%, Malaysia 3.1%, New Zealand 2.4%, Philippines 1.9%, Singapore 5.4%, Taiwan 8.8%
Top Ten Holdings & Weighting: Alibaba Health Information Technology Limited (241.HK) 3.3%, Ping An Insurance (Group) Company of China, Ltd. Class H (2318.HK) 2.8%, AIA Group Limited (1299.HK) 2.6%, Taipei Fubon Commercial Bank Co., Ltd Ordinary Shares (2881TT) 2.5%, China Construction Bank Corporation Class H (939.HK) 2.2%, Samsung Electronics Co., Ltd GDR 144A (SSNLF) 1.9%, ICICI Bank Limited Ordinary Shares (533274.IN) 1.8%,China Merchants Bank Co., Ltd Class H (3968.HK) 1.7%,BABA-SW (9988.HK) 1.7%,HDFC Bank Limited Ordinary Shares (500180.IN) 1.6%
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