SPEM: Why It's Not Just A Weaker-Dollar Story Boosting Emerging Markets

Why It Matters

SPEM’s favorable risk‑reward profile signals that emerging‑market equities are being driven by factors beyond a weaker dollar, attracting capital and reshaping asset‑allocation strategies.

Key Takeaways

• SPEM expense ratio 0.07%
• Dividend yield 2.58%
• AUM $16.7B, high liquidity
• Top holdings Taiwan 23%, China 30%, India 18%
• Technical target $65, support $47‑49

Pulse Analysis

The recent rally in emerging‑market equities cannot be reduced to a simple currency story. While a depreciating U.S. dollar has eased the cost of foreign earnings, broader macro forces are at play: robust global equity momentum, higher commodity prices supporting resource‑rich economies, and renewed risk appetite among institutional investors. These dynamics have lifted earnings expectations across the EM spectrum, creating a fertile environment for funds that capture diversified exposure.

SPEM stands out in this context due to its ultra‑low expense ratio of 0.07% and a respectable 2.58% dividend yield, making it an efficient vehicle for income‑seeking investors. With $16.7 billion in assets under management, the ETF enjoys deep liquidity, facilitating large trades without significant market impact. However, its concentration in Taiwan (23%), China (30%) and India (18%) introduces a geographic tilt that could amplify country‑specific risks, especially amid regulatory or geopolitical headwinds. The fund’s large‑cap, growth‑heavy tilt aligns with the current earnings‑driven rally but may underperform if value themes re‑emerge.

Technical charts suggest a bullish breakout, targeting $65 and offering 20‑30% upside from current levels, while strong support sits near $47‑$49. Investors should weigh this upside against concentration risk and potential volatility from policy shifts in the top holdings. Diversifying with complementary EM funds or adding sector‑specific exposure can mitigate single‑country exposure. Overall, SPEM provides a compelling blend of cost efficiency, yield, and momentum, positioning it as a strategic core holding for portfolios seeking to capitalize on the broader EM resurgence beyond mere dollar weakness.

SPEM: Why It's Not Just A Weaker-Dollar Story Boosting Emerging Markets

Mike Zaccardi, CFA, CMT · Feb. 17, 2026 8:15 PM ET

Summary

• State Street SPDR Portfolio Emerging Markets ETF remains a buy, supported by strong technicals, low valuation, and robust global equity momentum.

• SPEM offers broad EM exposure, a low 0.07 % expense ratio, and a 2.58 % dividend yield, with $16.7 billion AUM and high liquidity.

• The portfolio is large‑cap and growth‑heavy, with 23 % in Taiwan (notably TSM at 11 %), 30 % in China, and 18 % in India, creating concentration risk.

• Technical breakout targets $65 (20–30 % upside); the primary trend is bullish with strong support at $47–$49.

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Thawatchai Chawong/iStock via Getty Images

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Throw a dart at the globe, and chances are you’ll land on a hot stock market. The dollar’s drop since the start of the last year notwithstanding, both ex‑US developed and emerging markets have been on a

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