"The Avantis Emerging Markets Equity ETF (NYSEARCA:AVEM) delivered a 35% return in 2025, outperforming Vanguard's largest funds and signaling emerging markets might finally be having their moment. With $15.1 billion in assets and concentrated bets on Asian technology and financials, the fund beat both Vanguard S&P 500 ETF (NYSEARCA:VOO) and Vanguard Total Stock Market ETF (NYSEARCA:VTI) by roughly 17 percentage points."
"The most important macro factor for AVEM in 2026 is dollar strength. When the dollar weakens, as it did through much of 2025 with a 9% decline, emerging market assets become more attractive. Dollar-denominated debt gets cheaper to service, capital flows back into developing economies, and local currency returns improve for U.S. investors. Watch the dollar index weekly. If it breaks above recent highs and stays there, AVEM's momentum could stall regardless of individua"
Avantis Emerging Markets Equity ETF returned 35% in 2025 and outperformed Vanguard S&P 500 ETF (VOO) and Vanguard Total Stock Market ETF (VTI) by roughly 17 percentage points. The fund holds about $15.1 billion in assets and allocates 6.35% to Taiwan Semiconductor, with concentrated exposure to Asian technology and financial sectors. A roughly 9% decline in the U.S. dollar during 2025 materially boosted emerging market returns by lowering dollar-denominated debt costs, restoring capital flows, and improving local-currency returns for U.S. investors. Dollar strength in 2026 is the key macro risk that could stall AVEM's momentum.
Read at 247wallst.com
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