Marc Zeitoun, CFA, COO North America, Head of Strategic Beta & Private Client Advisory, Columbia Threadneedle met with Julie Cooling, Founder & CEO, RIA Channel to discuss the investment thesis behind the Columbia EM Core ex-China ETF (XCEM) and the current EM landscape.
XCEM, launched in 2015, was the first broad-based emerging markets ETF to exclude China from its index. The concept behind XCEM is not necessarily to divert investors away from China, but ultimately to give investors more choice in how they allocate to emerging markets. “XCEM gives investors the opportunity to express whatever point of view they have, as it relates to China,” explains Zeitoun.
In the face of current news cycles and continued uncertainty, some advisors look to reduce their overall allocation to China, while others prefer to get targeted exposure to China via an active or thematic strategy. XCEM focuses on broad diversification and provides emerging markets exposure, excluding China. The cost-efficient ETF aims to mitigate country-specific risks found in traditional EM indexes where China makes up a significant weighting.
Columbia Threadneedle Investments is a leading global asset manager that provides a broad range of investment strategies and solutions for individual, institutional and corporate clients around the world. Columbia Threadneedle manages $725 billion of assets across developed and emerging market equities, fixed income, asset allocation solutions and alternatives. To learn more: ColumbiaThreadneedleUS.com/ETFs