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Is VWO Vanguard Emerging Markets ETF Undervalued?
@koolgal:🌟🌟🌟Emerging Markets are expected to make a comeback in 2025 with a softened global growth forecast this year and geopolitics playing a growing role in reshaping the global economy. The forecast is for Emerging Markets to grow by 4.2% while the Developed Markets is expected to grow at just 1.7% over the next 2 years. This is according to the authorities at International Monetary Fund. VWO $Vanguard FTSE Emerging Markets ETF(VWO)$ is the largest ETF in this segment with Assets Under Management of USD 110.8 billion. VWO tracks an index that provides comprehensive exposure to the emerging markets equity space. These include Large Cap, Mid Cap and Small Cap stocks. VWO invests in stocks of companies located in Emerging Markets around the world such as China, Braziland South Africa. The Top 10 holdings include Taiwan Semiconductor Manufacturing (TSMC), Tencent Holdings, Alibaba Group, HDFC Bank, Meituan Dianping, Reliance Industries, Infosys, Hon Hai Precision Industry, China Construction Bank and PDD Holdings. Top 10 weightage is 24%. Total number of holdings is 5887. The expense ratio is a low 0.08%, the lowest among competing ETFs. The average expense ratio of similar funds is 1.15%. This means more money in investors' pockets. Dividends are paid every 3 months. The current dividend yield is 3.18%. VWO was ex dividend on December 20 2024. The next dividend is due in March 2025. $Taiwan Semiconductor Manufacturing(TSM)$ share price has been on a tear in 2024 as it is up 110%. There was strong demand for data centers. TSMC is the world's largest dedicated independent semiconductor foundry and Taiwan's largest company. TSMC's key customers include Apple, Nvidia as well as AMD, ARM, Broadcom and many more. $TENCENT(00700)$ is one of the highest grossing multi media companies in the world based on revenue. It is also the world's largest company in the video game industry. Tencent, also known for its flagship app WeChat is increasingly investing in AI driven platforms. Tencent's recent ventures into AI aim to harness its potential across different sectors from healthcare to financial services. Tencent is strategically positioning itself at the forefront of AI and quantum computing. Tencent's share price is up 41% in 2024 and may soar further in 2025 due to this latest development. $BABA-W(09988)$ is China's ECommerce Giant and also into other businesses such as retail, logistics as well as cloud computing. Alibaba's share price is up 15% in 2024 due to its ability to adapt to economic challenges and consumer behaviours and its focus on innovation. Alibaba is also investing in AI in order to revolutionise various aspects of its business model from retail, logistics and customer service. Reliance Industries is India's largest and most profitable private sector conglomerate. Its motto "Growth is Life" aptly captures the ever evolving spirit of Reliance. Its businesses include energy, petrochemicals, natural gas, retail, entertainment, telecommunications, mass media and textiles. HDFC Bank is India 's largest private sector bank by assets, value and market capitalisation. It recently reported that its deposits grew faster than its loans. It merged with its patent company HDFC in July 2023. While the above companies are the top holdings in VWO, this ETF offers a wide diversification as it holds 5887 stocks in its portfolio. Performance wise VWO is up 9.1% in 2024, underperforming the US markets. This could be a good time to invest in VWO as it could stage a rally to catch up with the US market. I invest in VWO as I believe that it is important to diversify my portfolio geographically so as it is not too US centric. VWO offers me tremendous diversification at a low cost. Maximum power, Minimum cost! That's my favourite way of investing. @Daily_Discussion @TigerStars @Tiger_comments @TigerClub @MillionaireTiger @CaptainTiger
Is VWO Vanguard Emerging Markets ETF Undervalued? Disclaimer: Investing carries risk. This is not financial advice. The above content should not be regarded as an offer, recommendation, or solicitation on acquiring or disposing of any financial products, any associated discussions, comments, or posts by author or other users should not be considered as such either. It is solely for general information purpose only, which does not consider your own investment objectives, financial situations or needs. TTM assumes no responsibility or warranty for the accuracy and completeness of the information, investors should do their own research and may seek professional advice before investing.