5 min readBy Ron Koren ETF Insider
How does the FEEM ETF work?
The FEEM ETF is a specialized investment fund that focuses on a specific sector. This exchange-traded fund offers investors exposure to a range of companies in this sector.
Flexshares Trust, as the issuer of the FEEM, focuses on providing investors with exposure to emerging market companies while emphasizing environmental, social, and governance (ESG) principles. The FEEM tracks the Underlying Index, which is meticulously designed to mirror the Northern Trust Emerging Markets Large Cap Index while prioritizing companies with higher ESG Vector Scores and lower carbon-related risks. The index employs screening mechanisms to exclude companies involved in controversial businesses and utilizes data from various sources to assess ESG performance and carbon-related metrics. Flexshares Trust employs a passive indexing approach, aiming to replicate the performance of the Underlying Index rather than attempting to outperform it. Through representative sampling, the fund invests in a subset of securities from the index, ensuring a similar investment profile. Additionally, Flexshares Trust may utilize various instruments to optimize portfolio exposure, including futures contracts and options, while maintaining at least 80% of its assets in securities from the Underlying Index. With a non-diversified status under the Investment Company Act of 1940, the fund may focus its investments on specific countries or industries, aligning closely with the concentration levels of the Underlying Index.
FEEM Dividend, offered by Flexshares Trust, is tailored to cater to investors seeking exposure to emerging market equities with a focus on dividend income. The fund tracks the performance of the Underlying Index, which prioritizes companies demonstrating strong environmental, social, and governance (ESG) characteristics while also seeking to minimize carbon-related risks. FEEM Dividend employs a passive indexing strategy, mirroring the composition and relative weightings of securities in the Underlying Index, as determined by Northern Trust International Indexes, the index provider. With a commitment to ESG principles, the fund seeks to invest in emerging market companies that not only provide dividend income but also align with sustainable investment goals. By maintaining at least 80% of its assets in securities from the Underlying Index, FEEM Dividend offers investors a convenient avenue to participate in emerging market dividends while promoting responsible investment practices.
FEEM Tracking, offered by Flexshares Trust, is designed to provide investors with an opportunity to track the performance of the Underlying Index, which focuses on emerging market equities with strong environmental, social, and governance (ESG) characteristics. Employing a passive indexing approach, FEEM Tracking replicates the composition and relative weightings of securities in the Underlying Index, as determined by Northern Trust International Indexes, the index provider. The fund aims to minimize tracking differences relative to the Parent Index while also seeking to enhance the aggregate ESG Vector Score and reduce carbon-related risks compared to its benchmark. By investing in a representative sample of securities from the Underlying Index, FEEM Tracking offers investors a straightforward and efficient means to gain exposure to emerging market equities while aligning with sustainable investment objectives.
FEEM Correlation, offered by Flexshares Trust, is tailored to meet the needs of investors seeking exposure to emerging market equities while managing correlation risks. The fund tracks the performance of the Underlying Index, which emphasizes companies with strong environmental, social, and governance (ESG) characteristics while also seeking to minimize carbon-related risks. Employing a passive indexing strategy, FEEM Correlation replicates the composition and relative weightings of securities in the Underlying Index, as determined by Northern Trust International Indexes, the index provider. By investing in a diversified portfolio of emerging market equities, the fund aims to mitigate correlation risks inherent in traditional equity investments. FEEM Correlation offers investors a strategic approach to navigating emerging market volatility while aligning with sustainable investment principles.
FEEM Sector, offered by Flexshares Trust, is designed to provide investors with targeted exposure to specific sectors within emerging market equities while emphasizing environmental, social, and governance (ESG) principles. The fund tracks the performance of the Underlying Index, which focuses on companies demonstrating strong ESG characteristics while seeking to minimize carbon-related risks. Utilizing a passive indexing strategy, FEEM Sector replicates the composition and relative weightings of securities in the Underlying Index, as determined by Northern Trust International Indexes, the index provider. By concentrating investments in select sectors of emerging market equities, the fund offers investors the opportunity to tailor their portfolios to specific industries while aligning with sustainable investment goals. FEEM Sector provides a strategic approach to sector-based investing in emerging markets, allowing investors to target areas of growth and opportunity while considering ESG factors.
FEEM Exposure, provided by Flexshares Trust, offers investors a comprehensive approach to gaining exposure to emerging market equities with a focus on environmental, social, and governance (ESG) considerations. The fund tracks the performance of the Underlying Index, meticulously curated to include companies exhibiting strong ESG characteristics while mitigating carbon-related risks. Employing a passive indexing strategy, FEEM Exposure mirrors the composition and relative weightings of securities in the Underlying Index, as determined by Northern Trust International Indexes, the index provider. By investing in a diversified portfolio of emerging market equities, the fund provides investors with broad exposure to the potential growth opportunities in these markets while prioritizing responsible investment practices. FEEM Exposure offers investors a straightforward and efficient means to participate in emerging market equities while aligning with sustainable investment objectives.
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