Frontier-Markets Funds Can Range Far and Wide
When going beyond emerging to frontier, consider what the funds own and how much they cost.
When going beyond emerging to frontier, consider what the funds own and how much they cost.
Gregg Wolper: Now that emerging markets have become an accepted destination for many investors, some are looking to the next level: frontier markets. Those are countries that are considered a little less developed than emerging markets as far as their stock markets, but not all frontier-markets funds are the same. Most of them do own smaller emerging markets as well as frontier markets, but there are differences.
For instance, Harding Loevner, their frontier-markets fund, that has about 15% to 20% of their assets in the Philippines alone. Their number-two holding, Jollibee Foods, which has about 4%--a fast food chain in the Philippines--that stock you won't find at all in Ashmore's version, which is Ashmore Emerging Markets Frontier Equity. That doesn't own Jollibee, and in fact, it only has about 3% in the Philippines--3% versus 15% to 20%.
Gregg Wolper does not own shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.