Emerging markets ex-China ETFs enjoy moment in the sun as investors snub China over 2023

65% average net asset increase

Emerging market excluding China ETFs saw a significant increase in assets over the course of 2023, driven by the nation's underperformance spurring investors to separate their allocation.

Data from Morningstar Direct revealed that ETFs with "ex-China" in their name saw an average 65% increase in total net assets between December 2022 and December 2023. For those domiciled specifically in Europe, there was a 42% average increase. According to its latest factsheet, the MSCI Emerging Market index has a 25.1% weighting in China, the highest individual regional exposure in the index. Jordan Sriharan, fund manager at Canada Life Asset Management, said that with over a quarter of the benchmark, the performance of the Chinese equity market was a key driver to the overall perfo...