Seeking Alpha

Ringing a bell? NJ backs off emerging markets bet

  • New Jersey's $76.8B pension fund cut its holdings of emerging market ETFs to less than $1.8B as of March 31, according to filings compiled by Bloomberg. As recently as 2009, EM holdings were about zero, but rose to over $3B by the end of 2012.
  • New Jersey's souring on a poor trade could be happening just as emerging markets are showing signs of rebounding following their worst relative performance last year in more than a decade. The MSCI emerging markets index (ETF: EEM) is up 10% since February 5, as is Vanguard's FTSE Emerging Markets ETF (VWO) - one of the funds cut back on by NJ.
  • New Jersey has company: In the last five quarters through March, investors have pulled $12B from Vanguard's $44B VWO and $12.8B from BlackRock's $36B EEM. The funds, however, have seen inflows of $4.6B since the end of March.
  • ETFs: EEM, VWO, DEM, EDC, DGS, EDZ, EEMV, SCHE, EEB, EDIV, IEMG, DVYE, EEV, EWX, BIK, BKF, PIE, ADRE, HILO, EUM, FNI, EET, GMM, EEMS, BBRC, PXH, EELV, DGRE, FEMS, EEME, EMDD, EDOG, BICK, DBEM, EMCR, FEM, EMBB, FNDE, EWEM, EVAL, EMLB, TLTE, EEHB, EMHD, EMDG, QDEM, EGRW, EMSA, EMDR, QEM, EMFT
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