"Most emerging market ETFs are built around the same assumption: that China's economy and equity markets will drive returns for decades. Columbia EM Core ex-China ETF (NYSEARCA:XCEM) rejects that premise entirely. This fund excludes Chinese equities altogether, offering investors exposure to emerging markets without the geopolitical risk, currency volatility, and regulatory uncertainty that have defined Chinese markets in recent years."
"South Korean semiconductors dominate XCEM's portfolio, with Samsung Electronics at 6.64%-a reflection of Korea's dominance in memory chips and the AI boom driving demand. This concentration in Korean tech represents a bet that semiconductor demand will continue to outpace broader emerging market growth, particularly as AI applications expand globally. The fund's second major theme is India's financial sector transformation, anchored by positions in ICICI Bank and other major lenders. These holdings capture India's digitization wave and credit expansion as the country's banking system modernizes and reaches previously underserved populations."
XCEM excludes Chinese equities entirely to provide emerging-market exposure without Chinese geopolitical, currency, and regulatory risks. The fund appeals to investors who view China’s growth as waning or who seek to avoid concentration in the world’s second-largest economy. Portfolio concentration centers on South Korean semiconductors, with Samsung Electronics at 6.64%, reflecting a bet on AI-driven chip demand. Indian financials, including ICICI Bank, capture digitization and credit expansion. The fund holds an unusually high 16.56% cash position and charges a 0.16% expense ratio. Additional holdings include Middle Eastern financials, Taiwanese electronics, and Brazilian industrials, exposing investors to different regional risks.
Read at 24/7 Wall St.
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