Different International Sector Weights
Posted on Wednesday, June 25th, 2008 | In Current Market NewsWhen you invest in emerging market indices and in non-US developed market indices, you are not only exposing your portfolio to different sales and earnings growth rates, but also to different industrial sectors.
The table, based on the S&P/Citigroup Global Broad Market Indices, shows the ratio of free-float market-cap of the GICS (Global Industrial Classification System) sectors in the emerging markets versus those of the developed markets, excluding the US market.
In total, the emerging markets provide a lot more Telecom and Energy, and a lot less Health Care and Consumer Discretionary, for example.
The broad emerging markets are represented by exchange traded funds such as EEM from Barclay’s and VWO from Vanguard.
The non-US developed markets are represented by exchange traded funds such as EFA from Barclay’s and VEA from Vanguard, in combination with EWC from Barclay’s, which tracks Canada.
Note the the EFA and VEA products track the MSCI/Barra Europe Australasia and Far East Index, which does not include Canada. EFA + EWC or VEA + EWC will cover the developed world excluding the US (see prior article for relative Candada and EAFE weights).
Richard Shaw
QVM Group LLC
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 About Richard Shaw (http://www.QVMgroup.com)
Richard is a principal of QVM Group LLC, a fee-based investment advisor based in Connecticut with clients across the country. He provides investment coaching to "do-it-yourself" investors, and manages portfolios for those who prefer not to make their own decisions. His investment approach is based on value, asset allocation, benchmarking, expense control, risk management, customizing portfolios to each client's specific circumstances, and regular communication about strategy and performance. The QVM Group team also provides municipal refinance services, strategic business planning and financial analysis service for new ventures, private acquisition analysis, and custom investment research. Richard's extensive experience, includes serving on the Board of Directors of Aberdeen Asset Management PLC (London Stock Exchange: ADN), membership on the Board of Directors of Phoenix Investment Counsel (renamed Virtus Investment Advisors), a U.S. pension manager and investment advisor to the Phoenix Funds (renamed Virtus Funds), as well as serving as Managing Director of a series of offshore investment funds based in Luxembourg. He has led institutional asset management sales and had overall responsibility for management of a U.S. mutual funds broker-dealer. He was a charter investor and member of the Board of Directors of several internet companies, including Lending Tree prior to its IPO. He is a graduate of Dartmouth College. QVM Group LLC is a Registered Investment Advisor. Visit the QVM Group website http://www.qvmgroup.com/QVMinvest/ |
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