The ProShares Short MSCI Emerging Markets ETF (EUM) is managed by ProShare Advisors and seeks to provide daily returns that are inverse (-1x) to the performance of the MSCI Emerging Markets Index. ProShare Advisors employs a mathematical approach to achieve this objective, utilizing financial instruments such as derivatives, including swap agreements, to gain inverse exposure to a representative sample of the index's securities. The ETF also invests in money market instruments like U.S. Treasury Bills and repurchase agreements to manage cash positions efficiently. EUM aims to offer investors a tactical tool for seeking inverse returns on emerging market equities on a daily basis. Please note that the fund's performance may deviate from the inverse of the index's returns over longer periods due to daily rebalancing and other factors. Additionally, the fund may concentrate its investments in specific industries or regions to align with the index's characteristics, and as of May 31, 2022, the MSCI Emerging Markets Index had a focus on information technology and financials industries, along with concentrations in China and Taiwan.
The ProShares Short MSCI Emerging Markets ETF (EUM) primarily aims to achieve daily returns that correspond inversely (-1x) to the performance of the MSCI Emerging Markets Index. While this ETF focuses on daily returns rather than dividends, it's important to note that it does not directly distribute dividends. EUM achieves its daily investment objective through a combination of financial instruments, including derivatives and money market instruments. Investors should not expect regular dividend distributions from this ETF, as its primary objective is to provide inverse exposure to the daily returns of the underlying index.
EUM, the ProShares Short MSCI Emerging Markets ETF, tracks the performance of the MSCI Emerging Markets Index, which is maintained by MSCI Inc. This index covers approximately 85% of the free float-adjusted market capitalization in emerging market countries, including countries like Brazil, Chile, China, Colombia, and many others. EUM primarily achieves its objective by investing in a combination of financial instruments, including derivatives and money market instruments, aiming to provide inverse (-1x) exposure to the daily returns of the MSCI Emerging Markets Index. Daily rebalancing and compounding are employed, making EUM's returns differ from the index's performance over longer periods, potentially resulting in losses due to market conditions and other factors. It is essential for investors to understand these intricacies and associated risks before considering EUM as part of their portfolio.
The correlation aspect of the ProShares Short MSCI Emerging Markets ETF (EUM) is unique due to its inverse exposure strategy. EUM aims to provide daily returns that are inversely correlated (-1x) to the performance of the MSCI Emerging Markets Index. Therefore, when the MSCI Emerging Markets Index rises, EUM is expected to decline in value. Conversely, when the index falls, EUM is designed to increase in value. This correlation structure makes EUM a valuable tool for investors seeking to profit from or hedge against declines in emerging markets.
The ProShares Short MSCI Emerging Markets ETF (EUM) is primarily focused on the emerging markets sector. EUM seeks daily returns that are inverse (-1x) to the performance of the MSCI Emerging Markets Index. The ETF achieves this through financial instruments such as swap agreements and money market instruments. As of June 30, 2022, the MSCI Emerging Markets Index comprised 24 emerging market country indexes, including Brazil, China, India, Mexico, and South Africa. EUM allows investors to take a short position on emerging markets, potentially providing a hedge against downturns in this volatile sector. However, it's important to note that EUM is designed for short-term trading and may not be suitable for long-term investments due to compounding and rebalancing effects.
The exposure characteristic of the ProShares Short MSCI Emerging Markets ETF (EUM) is designed to provide inverse (-1x) daily exposure to the MSCI Emerging Markets Index. This ETF seeks to achieve its investment objective by investing in financial instruments, primarily derivatives, and money market instruments. EUM is structured to benefit from declines in the performance of emerging market equities, offering investors a way to hedge or profit from potential downward movements in these markets. To explore this exposure and gain a deeper understanding of EUM''s positioning within the emerging markets, you can utilize ETF Insider''s web app, which offers comprehensive data visualization tools, enabling you to analyze correlations, overlaps, and more for various US ETFs.
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