Vanguard Emerging Mkt Index different from benchmark index?

[wildcat]

Can anyone explain that one to me. For example, why does China = 8% of the portfolio for the EEM but only .3% for the Vanguard Emerging Markets Fund and same goes for the VIPER? The EEM seems much more diversified. Thoughts or answers?

http://flagship4.vanguard.com/VGApp/hnw/FundsHoldings?FundId=0533&FundIntExt=INT

http://www.ishares.com/material_dow...ository/material/downloads/fact_sheet/eem.pdf

 

[ats5g]

Hi Wildcat,

I think you may be reading the Vanguard site wrong. The two colums for country breakdown are for the Fund for 5/31/05 + 5/31/04. As of 5/31/05, China was 8% of the Vanguard fund. I also think that the Vanguard fund tracks a slightly different index than EEM, an index that MSCI created specifically for Vanguard, that only the Vanguard fund uses.

- Alec

 

[wildcat]

I think you may be reading the Vanguard site wrong. The two colums for country breakdown are for the Fund for 5/31/05 + 5/31/04. As of 5/31/05, China was 8% of the Vanguard fund. I also think that the Vanguard fund tracks a slightly different index than EEM

Makes sense thanks. Yeah seems as though Vanguard tracks selected emerging markets.

 

[cute fuzzy bunny]

Index funds DO often meander from their indexes. You may find in the prospecti a statement that the fund manager 'samples' stocks from the index to closely match the index without overowning small or deemed irrelevant stocks. In certain cases, should index managers actually own the requisite shares in every requisite company, there might not be enough shares to go around.