Chinese stocks have been risky buys this year as government crackdowns and tensions with the U.S. have put investors on edge.
That makes investing in a global exchange-traded fund (ETF) or even one that is focused on all emerging markets a bit more undesirable than it otherwise would be.
However, if you still want to invest in emerging markets, there could be a viable alternative: iShares MSCI Emerging Markets ex China ETF (NASDAQ:EMXC). The fund gives exposures to other markets in Asia, with Taiwan accounting for 22% of its holdings. South Korea makes up just under 20% and India also represents a significant chunk at over 17%. It also invests in companies that are based in Brazil, Russia, Saudi Arabia, and many other countries.
The top holding in the fund is Taiwan Semiconductor Manufacturing (NYSE:TSM) at roughly 10%. Samsung Electronics makes up 6%. But beyond that, no other investment accounts for more than 2% of the ETF's weight – it has more than 600 holdings as of Aug. 19. And the stocks aren't excessively priced, as the fund averages a price-to-earnings multiple of 21. With a net expense ratio of just 0.25%, management fees aren't going to take away from much of your returns in this fund. In the past year, the ETF's total returns have totaled 29% -- just slightly below the S&P 500, which increased in value by 32%.
For long-term investors, the Emerging Markets ex China ETF is a solid opportunity to invest in some of the top markets in the world.