US-based ETP sponsor WisdomTree, a global financial innovator, has launched an merging markets Ucits ETF.
WEM aims to track the price and yield performance, before fees and expenses, of the WisdomTree True Emerging Markets Ucits Index and has a Total Expense Ratio (TER) of 0.25%. WEM listed today on Börse Xetra, Borsa Italiana, Euronext Paris, the Swiss exchange Six, and will list on the London Stock Exchange tomorrow.
The proprietary Index is designed to provide diversified exposure to countries that remain genuinely emerging in terms of economic development and capital market maturity, offering investors a more intentional way to access long-term emerging market (EM) growth.
Unlike traditional emerging market benchmarks, which can be dominated by a small number of large and increasingly mature markets, the Index uses a systematic, multi-metric framework to identify economies that continue to exhibit development-led growth characteristics. As such, the ETF avoids allocating to China, Korea and Taiwan, which are present in most broad EM strategies.
Traditional emerging market indices have evolved over time and can now be dominated by a small number of large markets and mega-cap companies. As a result, broad EM exposure can increasingly behave like a concentrated country or stock allocation, rather than a diversified investment in development-led growth. The WisdomTree True Emerging Markets UCITS ETF is designed to address this challenge by redefining the emerging markets universe around development and market maturity, rather than legacy classifications alone.
Pierre Debru, Head of Research, Europe, WisdomTree, said: “Emerging markets investing is fundamentally about capturing the growth potential that arises as economies transition from lower to middle-income status.
“This development process is typically supported by rising productivity, expanding domestic demand, improving institutions, and deepening capital markets. This innovative strategy is designed to restore that original intent by focusing on countries where rising incomes, structural change and capital market deepening are still powerful drivers of long-term returns.”
