Three iShares and Columbia ETFs focusing on emerging markets excluding China have surged 36-41% year-to-date, widening their lead over the S&P 500.
Three emerging markets ETFs excluding China have delivered year-to-date gains of 36% to 41%, outpacing the S&P 500’s 9% rise by approximately 30 percentage points. The iShares MSCI Emerging Markets ex China ETF (EMXC), Freedom 100 Emerging Markets ETF (FRDM), and Columbia EM Core ex-China ETF (XCEM) lead the segment.
Standard emerging market benchmarks allocate about 30% to China, but ex-China funds reallocate capital to markets like Taiwan, India, and South Korea, which posted returns exceeding 55% in 2025. FRDM’s strategy, which excludes authoritarian regimes, achieved an 82% one-year return but carries a 0.49% expense ratio, nearly double that of EMXC.
The divergence reflects investor appetite for exposure to high-growth emerging markets while avoiding China’s economic and geopolitical risks.