Billions flood active ETFs in hunt for cheap EM stocks

"If ever there was a compelling case for a more systematic approach to active management, it's now," said Donald Calcagni, chief investment officer of Mercer Advisors Investment Management and a buyer of active emerging-market ETFs.

New York: As investors scour the globe for under-valued stocks, one increasingly popular destination is actively managed exchange-traded that focus on emerging . In the $348 billion market for that invest in developing-nation assets, the holdings of only about 5% of funds are actively managed - rather than pinned directly to an underlying index, according to data compiled by Bloomberg. But those actively managed funds have lured in more than a third of new cash that's flowed into the asset class over the past year and more than 50% in the past month.

"If ever there was a compelling case for a more systematic approach to active management, it's now," said Donald Calcagni, chief investment officer of Mercer Advisors Investment Management and a buyer of active emerging-market ETFs. "Look at all the dislocations that are happening globally, at , at how concentrated markets have become."

Source: Stocks-Markets-Economic Times