VWO ETF: Declining China Exposure To Hurt Returns

2d illustrations and photos I last wrote on the Vanguard FTSE Emerging Markets Index Fund ETF (NYSEARCA:VWO) in July last year, where I argued rising bond yields relative to the index’s dividend yield no longer justified a bullish position. Since then, the VWO’s yield has declined while Treasury yields have risen further. Furthermore, the weighting of China has fallen due to falling valuations of Chinese stocks, which has left investors with heavy exposure to the Indian and Taiwanese markets, which are looking increasingly stretched. I continue to rate VWO as a ‘hold’ but would use any strength to shift into…