EMB

EMB was one of the first emerging-market debt ETFs to be launched, as such, it tends to enjoy strong assets and liquidity. Like many peer funds, but in contrast with our benchmark, EMB holds USD-denominated rather than local-currency debt. This eliminates direct currency risk for US investors, but raises the possibility that a strengthening dollar or weakening local currency could make the debt harder to service, increasing credit risk. Each issuer must have at least $1B outstanding and bonds need at least 2 years remaining to maturity. The fund typically favors longer maturities than our benchmark and tends to lean toward riskier paper, both of which increase yield. One of EMB's strongest selling points is its strong liquidity, making it the de facto choice for traders.