Int'l Equity Fund that Excluldes CHINA
- walescynwyd
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Int'l Equity Fund that Excluldes CHINA
Vanguard has VEU (All-World ex-US ETF) but I am looking for a VEC (e.g., All-World ex-China ETF). An ETF including Taiwanese companies is fine with me. I consider Hong Kong companies also fall into "China region". I have not found an ETF, an internal (not a region-specific) fund, or an emerging market equity fund that excludes China region. If you already know one, please share. Thanks!
PS: Vanguard Small Cap Index funds (including its Growth and Value siblings), Mega Caps (MGK, MGC, MGV), VFIAX, VDIGX... have 0% explosures to China region. But some US equity funds such as US growth (VWUAX), Mid-cap growth (VMGMX), Extended Market Index (VEXAX)... all have around 1% explosures to China region.
PS: Vanguard Small Cap Index funds (including its Growth and Value siblings), Mega Caps (MGK, MGC, MGV), VFIAX, VDIGX... have 0% explosures to China region. But some US equity funds such as US growth (VWUAX), Mid-cap growth (VMGMX), Extended Market Index (VEXAX)... all have around 1% explosures to China region.
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- walescynwyd
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Re: Int'l Equity Fund that Excluldes CHINA
Thank you JAZZISCOOL for sharing this information at another thread.
Ideas on other investment options are appreciated!Ishares ETF possibly....iShares MSCI Emerging Markets ex China ETF
You can add on something like EFA ETF for the developed int'l equity.
https://www.ishares.com/us/products/288 ... china-etf/
"You can't change who your parents are but you can choose who your friends are." - K.M.
Re: Int'l Equity Fund that Excluldes CHINA
Some other ideas:
If you don't like the iShares fund, you're probably looking for the first one here.
If you don't like the iShares fund, you're probably looking for the first one here.
A useful razor: anyone asking about speculative strategies on Bogleheads.org has no business using them.
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Re: Int'l Equity Fund that Excluldes CHINA
XCEM: excludes China and Hong Kong.
- nisiprius
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Re: Int'l Equity Fund that Excluldes CHINA
Any developed markets index fund should exclude China, because China is an emerging market. However, you will need to buy a separate US fund.
For example, Vanguard VTMGX/VEA (Australia, Austria, Belgium, Canada, Denmark, Finland, France, Germany, Hong Kong, Ireland, Israel, Italy, Japan, Korea, Netherlands, New Zealand, Norway, Other, Poland, Portugal, Singapore, Spain, Sweden, Switzerland, United Kingdom)
For example, Vanguard VTMGX/VEA (Australia, Austria, Belgium, Canada, Denmark, Finland, France, Germany, Hong Kong, Ireland, Israel, Italy, Japan, Korea, Netherlands, New Zealand, Norway, Other, Poland, Portugal, Singapore, Spain, Sweden, Switzerland, United Kingdom)
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Re: Int'l Equity Fund that Excluldes CHINA
EMXC - iShares MSCI Emerging Markets ex China ETF
KEMX - KraneShares MSCI Emerging Markets ex China Index ETF
KEMX - KraneShares MSCI Emerging Markets ex China Index ETF
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Re: Int'l Equity Fund that Excluldes CHINA
An emerging markets fund. I use it in combination with VWO (emerging markets index fund) to reduce single-country risk (China).
- walescynwyd
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Re: Int'l Equity Fund that Excluldes CHINA
VEA has 2.64% explosures to China (2.4 HKG + .24 China). I agree any developed markets index should exclude China.nisiprius wrote: ↑Sun Mar 07, 2021 7:34 pm Any developed markets index fund should exclude China, because China is an emerging market. However, you will need to buy a separate US fund.
For example, Vanguard VTMGX/VEA (Australia, Austria, Belgium, Canada, Denmark, Finland, France, Germany, Hong Kong, Ireland, Israel, Italy, Japan, Korea, Netherlands, New Zealand, Norway, Other, Poland, Portugal, Singapore, Spain, Sweden, Switzerland, United Kingdom)
"You can't change who your parents are but you can choose who your friends are." - K.M.
- walescynwyd
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Re: Int'l Equity Fund that Excluldes CHINA
Thank you everyone for helpful comments, from which I found an article mentioning the four ETFs.
https://www.etf.com/publications/etfr/e ... hout-china
https://www.etf.com/publications/etfr/e ... hout-china
"You can't change who your parents are but you can choose who your friends are." - K.M.
- walescynwyd
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Which Emerging Markets ETF?
[Merged into the existing discussion -- moderator oldcomputerguy]
Hi, after some thoughts, I have decided to allocate a small (around 5%) of my investment to an emerging markets ETF. I came down to these two: Vanguard FTSE Emerging Markets ETF (VWO) and Freedom 100 Emerging Markets ETF (FRDM). Both are EM markets funds but employ different strategies. Can't decide which one to go. Your thoughts? I plan to keep that money invested for 15 to 20 years. Thanks!
Hi, after some thoughts, I have decided to allocate a small (around 5%) of my investment to an emerging markets ETF. I came down to these two: Vanguard FTSE Emerging Markets ETF (VWO) and Freedom 100 Emerging Markets ETF (FRDM). Both are EM markets funds but employ different strategies. Can't decide which one to go. Your thoughts? I plan to keep that money invested for 15 to 20 years. Thanks!
"You can't change who your parents are but you can choose who your friends are." - K.M.
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Re: Which Emerging Markets ETF?
Depends on what area of EM you want to capture.
I prefer Fidelity's FPADX because it includes countries like South Korea which I'd like more exposure to. Some funds are more China-heavy (like Vanguard) and omit South Korea.
I prefer Fidelity's FPADX because it includes countries like South Korea which I'd like more exposure to. Some funds are more China-heavy (like Vanguard) and omit South Korea.
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Re: Which Emerging Markets ETF?
I have VWO(https://investor.vanguard.com/etf/profile/portfolio/vwo), liked its country holdings. If you wan to overload into one country, you can always buy some of country specific ETFs, I use Franklin ETF for that sepcifically, as I also wanted more exposure to a specific country
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Re: Which Emerging Markets ETF?
I would question the allocation size of 5% which isn't enough to have much effect on the overall portfolio. So you're adding a portfolio management complication (an additional fund) for no especially good reason. Generally, 10% is considered the minimum effective amount.
I use EM for diversification and target 25% of stocks. It's the best diversifier for the US market. So I get an EM contribution from Total Intl Stock, VWO, and XCEM (ex-China).
I use EM for diversification and target 25% of stocks. It's the best diversifier for the US market. So I get an EM contribution from Total Intl Stock, VWO, and XCEM (ex-China).
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Re: Int'l Equity Fund that Excluldes CHINA
What’s the reasoning for omitting China?
20% VOO | 20% VXUS | 20% AVUV | 20% AVDV | 20% AVES
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Re: Int'l Equity Fund that Excluldes CHINA
Not necessarily omit--maybe just reduce.
China includes a lot of state-owned industry that have non-profit-related goals such as employment quotas, etc. Also, the fund companies such as Vanguard have capitulated to Chinese demands to raise fund allocations. Then, there are a lot of issues that we can't discuss here.
If the OP does go with a mere 5% EM, then 44% of 5% EM = 2.2% China may not matter to them even if it does go to zero during inter-countries conflict.
- walescynwyd
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Re: Int'l Equity Fund that Excluldes CHINA
Thanks a lot everyone for sharing your valuable insights. I am not omitting or reducing China. I think it's a market with great potentials but I would prefer investing in China through investing non-Chinese enterprises companies that conduct business in China. One may call it a matter of approach, method or style of investment. Also, I have not found a fund, other than FRDM, that allocates big portions to the former Eastern European region (Poland), Africa (South Africa), and South America (Chile). I have been a little bit of a contrarian investor in the US equity market for the last 20 years, and that approach has brought me with some good luck; I don't chase high flying ETFs (in this case, China-heavy ETF) and and I buy ETFs when they are unfairly beaten. So I hope to be able to approach the EM in a similar way, and FRDM could potentially deliver that for me. The only reason that I am debating FRDM with VWO is its history; FRDM is still a very young fund. And VWO's low cost... Anyway, I don't have to decide this today and will continue to investigate. In the meantime, thank you for all your inputs.
"You can't change who your parents are but you can choose who your friends are." - K.M.
- walescynwyd
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Re: Which Emerging Markets ETF?
Indeed. After some thoughts, I may increase that allocation size to somewhere close to what you are suggesting. Thanks!pascalwager wrote: ↑Tue Mar 09, 2021 1:23 am I would question the allocation size of 5% which isn't enough to have much effect on the overall portfolio. So you're adding a portfolio management complication (an additional fund) for no especially good reason. Generally, 10% is considered the minimum effective amount.
I use EM for diversification and target 25% of stocks. It's the best diversifier for the US market. So I get an EM contribution from Total Intl Stock, VWO, and XCEM (ex-China).
"You can't change who your parents are but you can choose who your friends are." - K.M.
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Re: Int'l Equity Fund that Excluldes CHINA
Your avatar is Jan Michael Vincent (aka Stringfellow Hawke) from Airwolf!walescynwyd wrote: ↑Sun Mar 07, 2021 12:58 pm Vanguard has VEU (All-World ex-US ETF) but I am looking for a VEC (e.g., All-World ex-China ETF). An ETF including Taiwanese companies is fine with me. I consider Hong Kong companies also fall into "China region". I have not found an ETF, an internal (not a region-specific) fund, or an emerging market equity fund that excludes China region. If you already know one, please share. Thanks!
PS: Vanguard Small Cap Index funds (including its Growth and Value siblings), Mega Caps (MGK, MGC, MGV), VFIAX, VDIGX... have 0% explosures to China region. But some US equity funds such as US growth (VWUAX), Mid-cap growth (VMGMX), Extended Market Index (VEXAX)... all have around 1% explosures to China region.
Tony
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Re: Int'l Equity Fund that Excluldes CHINA
In the years ahead, it may become increasingly difficult to ignore the rise of China into the global commerce and the global economy.walescynwyd wrote: ↑Sun Mar 07, 2021 12:58 pm Vanguard has VEU (All-World ex-US ETF) but I am looking for a VEC (e.g., All-World ex-China ETF). An ETF including Taiwanese companies is fine with me. I consider Hong Kong companies also fall into "China region". I have not found an ETF, an internal (not a region-specific) fund, or an emerging market equity fund that excludes China region. If you already know one, please share. Thanks!
PS: Vanguard Small Cap Index funds (including its Growth and Value siblings), Mega Caps (MGK, MGC, MGV), VFIAX, VDIGX... have 0% explosures to China region. But some US equity funds such as US growth (VWUAX), Mid-cap growth (VMGMX), Extended Market Index (VEXAX)... all have around 1% explosures to China region.
Tony
John C. Bogle: “Simplicity is the master key to financial success."
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Re: Int'l Equity Fund that Excluldes CHINA
Tariffs. Although I have been reading incredible articles in the Wall Street Journal about Jack Ma and the failed IPO of Alipay.
Tony
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Re: Int'l Equity Fund that Excluldes CHINA
Yes, Tony. It is not one of the most obvious but glad someone noticed it. When I was young, more than one occasions I was told I looked like him...
"You can't change who your parents are but you can choose who your friends are." - K.M.
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Re: Int'l Equity Fund that Excluldes CHINA
He had Hollywood in the palm of his hand in early 80s. Highest paid actor on television with Airwolf. Last I saw him was on Nash Bridges playing Don Johnson’s brother Bobby. Had a rough life of alcohol and drugs which ultimately resulted in a devastating automobile accident that permanently ruined his vocal cords and thus his Hollywood career. He died way to young a year or two ago.walescynwyd wrote: ↑Tue Mar 09, 2021 9:10 pmYes, Tony. It is not one of the most obvious but glad someone noticed it. When I was young, more than one occasions I was told I looked like him...
Tony
John C. Bogle: “Simplicity is the master key to financial success."
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Re: Int'l Equity Fund that Excluldes CHINA
But VWO holds 44% China while FRDM holds 0% China, so I don't understand why you would even consider VWO given your preferred approach to China investing discussed above.walescynwyd wrote: ↑Tue Mar 09, 2021 7:56 pm Thanks a lot everyone for sharing your valuable insights. I am not omitting or reducing China. I think it's a market with great potentials but I would prefer investing in China through investing non-Chinese enterprises companies that conduct business in China. One may call it a matter of approach, method or style of investment. Also, I have not found a fund, other than FRDM, that allocates big portions to the former Eastern European region (Poland), Africa (South Africa), and South America (Chile). I have been a little bit of a contrarian investor in the US equity market for the last 20 years, and that approach has brought me with some good luck; I don't chase high flying ETFs (in this case, China-heavy ETF) and and I buy ETFs when they are unfairly beaten. So I hope to be able to approach the EM in a similar way, and FRDM could potentially deliver that for me. The only reason that I am debating FRDM with VWO is its history; FRDM is still a very young fund. And VWO's low cost... Anyway, I don't have to decide this today and will continue to investigate. In the meantime, thank you for all your inputs.
- walescynwyd
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Re: Int'l Equity Fund that Excluldes CHINA
Lack of confidence is the reason. Once I am convinced I've heard and investigated enough to confirm my current thought is indeed a right one, I will walk on that course. This forum is great.pascalwager wrote: ↑Tue Mar 09, 2021 11:55 pmBut VWO holds 44% China while FRDM holds 0% China, so I don't understand why you would even consider VWO given your preferred approach to China investing discussed above.walescynwyd wrote: ↑Tue Mar 09, 2021 7:56 pm Thanks a lot everyone for sharing your valuable insights. I am not omitting or reducing China. I think it's a market with great potentials but I would prefer investing in China through investing non-Chinese enterprises companies that conduct business in China. One may call it a matter of approach, method or style of investment. Also, I have not found a fund, other than FRDM, that allocates big portions to the former Eastern European region (Poland), Africa (South Africa), and South America (Chile). I have been a little bit of a contrarian investor in the US equity market for the last 20 years, and that approach has brought me with some good luck; I don't chase high flying ETFs (in this case, China-heavy ETF) and and I buy ETFs when they are unfairly beaten. So I hope to be able to approach the EM in a similar way, and FRDM could potentially deliver that for me. The only reason that I am debating FRDM with VWO is its history; FRDM is still a very young fund. And VWO's low cost... Anyway, I don't have to decide this today and will continue to investigate. In the meantime, thank you for all your inputs.
"You can't change who your parents are but you can choose who your friends are." - K.M.
Re: Int'l Equity Fund that Excluldes CHINA
You still probably have a lot of indirect exposure to Mainland China in any of these funds.
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Re: Which Emerging Markets ETF?
I now own TISM, VWO, and also VSS that hold China-Hong Kong. In addition to XCEM, I get a China dilution effect from my bonds, of course. So, I'm presently allocated as follows:pascalwager wrote: ↑Tue Mar 09, 2021 1:23 am I would question the allocation size of 5% which isn't enough to have much effect on the overall portfolio. So you're adding a portfolio management complication (an additional fund) for no especially good reason. Generally, 10% is considered the minimum effective amount.
I use EM for diversification and target 25% of stocks. It's the best diversifier for the US market. So I get an EM contribution from Total Intl Stock, VWO, and XCEM (ex-China).
Emerging markets: 14.2% of portfolio, 23.1% of stocks
China-Hong Kong: 4.6% of portfolio, 32.2% of emerging markets
I'll generally continue to move any VWO distributions into XCEM (China-free) and do any EM rebalancing out of VWO and into XCEM.
Note: VWO and XCEM are in a taxable account.
Re: Int'l Equity Fund that Excluldes CHINA
I also don’t want 40% China, but some of these ETFs are thinly traded and thus subject to price spreads.
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Re: Int'l Equity Fund that Excluldes CHINA
Very true, and more:
XCEM 0.90% bid/ask spread, overall "F" rating, high risk of closure.
I tend to do mid-point limit orders. (It does have a relatively low ER of 16 bps.)
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Re: Int'l Equity Fund that Excluldes CHINA
Update: I decided to invest in FRDM and did it in mid March. Unlike XCEM and other ex-China funds, FRDM excludes Russia too. Yes, a month is extremely short but so far I feel I made the right decision, and intend to stick around for long. It's interesting Chile now overtook Taiwan as this fund's largest country exposure, at 19.94%.walescynwyd wrote: ↑Wed Mar 10, 2021 7:00 amLack of confidence is the reason. Once I am convinced I've heard and investigated enough to confirm my current thought is indeed a right one, I will walk on that course. This forum is great.pascalwager wrote: ↑Tue Mar 09, 2021 11:55 pmBut VWO holds 44% China while FRDM holds 0% China, so I don't understand why you would even consider VWO given your preferred approach to China investing discussed above.walescynwyd wrote: ↑Tue Mar 09, 2021 7:56 pm Thanks a lot everyone for sharing your valuable insights. I am not omitting or reducing China. I think it's a market with great potentials but I would prefer investing in China through investing non-Chinese enterprises companies that conduct business in China. One may call it a matter of approach, method or style of investment. Also, I have not found a fund, other than FRDM, that allocates big portions to the former Eastern European region (Poland), Africa (South Africa), and South America (Chile). I have been a little bit of a contrarian investor in the US equity market for the last 20 years, and that approach has brought me with some good luck; I don't chase high flying ETFs (in this case, China-heavy ETF) and and I buy ETFs when they are unfairly beaten. So I hope to be able to approach the EM in a similar way, and FRDM could potentially deliver that for me. The only reason that I am debating FRDM with VWO is its history; FRDM is still a very young fund. And VWO's low cost... Anyway, I don't have to decide this today and will continue to investigate. In the meantime, thank you for all your inputs.
Re: Int'l Equity Fund that Excluldes CHINA
Me too
FRDM is based on third-party freedom indexes, so no investments in countries like China and Russia
ER is very high but hopefully will be reduced as AUM grows
Liquidity is low, but not a major concern with limit orders, and a few pennies are meaningless when holding long term
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