2014.06.2702:47:10UTC+00Exchange traded funds target returns in emerging markets

Some of the world’s largest exchange traded funds (ETFs) are taking advantage of bull markets around the world as markets of developing nations continue to improve.

According to Bloomberg data, nearly $11 billion have been allocated to ETFs that track securities in markets such as Brazil, Thailand, and Turkey. The amount signifies the return of investors to the sector after $31 billion in investments were  pulled out earlier in March over fears borne from global civil unrest in the form of a coup in Thailand and an annexation of eastern Ukraine.

The iShares MSCI Emerging Markets ETF from BlackRock, one of the world’s biggest fund managers, received $5.9 billion in new money since that time alongside the $1.3 billion of Vanguard’s FTSE Emerging Markets ETF.

It has proven to be a profitable decision for investors so far with emerging markets gaining 5.2% to post better returns than their advanced counterparts for the first time in a year and two quarters. Almost all 296 Bloomberg monitored sovereign dollar bonds have climbed so far this year, with only three failing to do so.

Among the favorites of asset managers include Thailand where the belief that its military government will accelerate economy-reviving measures has sparked their stock exchange’s SET index benchmark to surge up 21%. At the same time, expected new growth policies in Brazil pushed its Ibovespa index to climb 20%  to bounce back back from a low in March. Similarly, in Turkey, the Borsa Istanbul 100 Index leapt up 28% even as Prime Minister Recep Tayyup Erdogan battles accusations of election tampering.

Even non-equity focused ETFs have garnered increased attention  this quarter with BlackRock’s USD Emerging Markets Bonds ETF and Invesco’s Sovereign Debt Portfolio achieving an inflow of $1.3 billion.