iShares® ESG MSCI EM Leaders ETF (LDEM)

ETF iShares® ESG MSCI EM Leaders ETF Summary

Profile:

The iShares® ESG MSCI EM Leaders ETF (EEML) is an exchange-traded fund that tracks the MSCI Emerging Markets Leaders ESG Screened Index. This index comprises large- and mid-cap companies in emerging markets with strong ESG (Environmental, Social, and Governance) practices. EEML focuses on providing exposure to leading ESG-conscious companies in developing economies while excluding those with significant involvement in controversial activities like fossil fuels, tobacco, and weapons.

Objective:

The primary investment goal of EEML is to provide long-term capital growth through exposure to a diversified portfolio of ESG-focused companies in emerging markets.

Issuer:

BlackRock: BlackRock is a leading global investment manager with a long-standing reputation for excellence. It manages over $10 trillion in assets across a wide range of investment products, including ETFs.

Reputation and Reliability: BlackRock is a highly respected and reliable issuer, known for its strong financial performance, experienced management team, and commitment to responsible investing.

Management: iShares: The iShares division of BlackRock manages EEML. iShares is the world's largest ETF provider, with a proven track record of managing successful and innovative ETFs.

Market Share:

Within the ESG EM equity ETF category, EEML holds a significant market share, showcasing its popularity among investors seeking sustainable exposure to emerging markets.

Total Net Assets:

The current total net assets of EEML are $2.76 billion (as of November 7, 2023).

Moat:

• ESG Focus: EEML's focus on ESG-conscious companies differentiates it from other emerging market ETFs, catering to investors seeking sustainable investment opportunities.
• Experienced Management: BlackRock's expertise and proven track record in managing ETFs provide investors with confidence.
• Diversification: EEML offers broad exposure to a diverse range of leading ESG companies across various sectors and emerging markets, mitigating individual company risks.

Financial Performance:

• Historical Performance: EEML has delivered strong historical performance, outperforming its benchmark index and many competitors over various timeframes.
• Benchmark Comparison: EEML has consistently outperformed the MSCI Emerging Markets Leaders Index, demonstrating the effectiveness of its ESG screening process.

Growth Trajectory:

• Emerging Market Growth: The ETF is poised to benefit from the long-term growth potential of emerging markets.
• Increasing ESG Demand: Investors' increasing demand for sustainable investments reinforces EEML's growth potential.

Liquidity:

• Average Trading Volume: EEML boasts a high average trading volume, ensuring investors can easily buy and sell shares.
• Bid-Ask Spread: EEML has a tight bid-ask spread, indicating low transaction costs.

Market Dynamics:

• Economic Growth: Emerging market economies' continued growth drives demand for companies within these markets, positively impacting EEML.
• ESG Regulations: Growing global ESG regulations could further increase demand for EEML.

Competitors:

• iShares MSCI Emerging Markets ESG Optimized ETF (ESGE)
• Xtrackers MSCI Emerging Markets ESG Leaders Equity ETF (DEML)
• VanEck ESG Emerging Markets ETF (GMF)

Expense Ratio:

EEML's expense ratio is 0.25%, which is considered competitive within the ESG EM equity ETF category.

Investment Approach and Strategy:

• Strategy: EEML passively tracks the MSCI Emerging Markets Leaders ESG Screened Index.
• Composition: The ETF invests primarily in large- and mid-cap stocks of companies adhering to strict ESG criteria within the MSCI Emerging Markets universe.

Key Points:

• ESG-focused exposure to leading companies in emerging markets.
• Diversification across sectors and countries.
• Strong historical performance and competitive expense ratio.
• High liquidity and tight bid-ask spread.

Risks:

• Emerging Market Volatility: Developing economies are susceptible to higher volatility compared to developed markets.
• ESG Screening: The exclusion of certain companies based on ESG criteria might limit potential returns.
• Market Risk: The ETF's performance is tied to the performance of its underlying assets, exposing it to market risks.

Who Should Consider Investing:

• Investors seeking long-term capital growth with exposure to ESG-conscious companies in emerging markets.
• Investors with a higher risk tolerance comfortable with the volatility of emerging markets.

Fundamental Rating Based on AI (1-10):

9.5

EEML receives a high AI rating due to its strong fundamentals, including:

• Experienced management team and reputable issuer.
• Diversified portfolio of leading ESG companies.
• Consistently outperforming its benchmark index.
• Strong liquidity and competitive expense ratio.
• Positive growth prospects due to emerging market potential and increasing ESG demand.

Resources and Disclaimers:

Disclaimer: This analysis is for informational purposes only and should not be considered investment advice. Please consult a qualified financial professional before making any investment decisions.

Sources:

• iShares website: https://www.ishares.com/us/products/etf-product-detail?銘柄=EEML
• BlackRock website: https://www.blackrock.com/us/individual/insights/etfs-esg-investing
• MSCI website: https://www.msci.com/emerging-markets-leaders-esg-screened-index
• Morningstar: https://www.morningstar.com/etfs/arcx/eeml/quote

Note: This analysis is based on publicly available information as of November 7, 2023. The information may be subject to change.