AVXC vs VEM

AVXCAAvantis Emerging Markets ex-China Equity ETF

VEMCVirtus Emerging Markets Dividend ETF

In short

AVXC The China question, answered by subtraction. Avantis runs its usual emerging-markets playbook (roughly 2,800 stocks of every size, tilted toward the cheap and the profitable) with China left out entirely, for 0.33% a year.

VEM Most emerging-market funds sell you the growth story. This one flips the order: current income first, capital appreciation second, in a compact actively run portfolio priced below the typical active EM fee.

Stated mandate

AVXC The fund invests in a broad set of companies across emerging-market countries, excluding China, and spanning all market capitalizations. It seeks higher expected returns by overweighting securities with lower valuations and higher profitability ratios.

VEM The Fund seeks current income and, secondarily, long-term capital appreciation. It invests at least 80% of its assets in dividend-paying securities economically connected to emerging-market countries.

Why people hold it

• AVXC 0.33% a year, about half the typical fee among active EM funds, and the ex-China carve-out costs no more than Avantis charges on its with-China flagship, AVEM.
• Roughly 2,800 holdings spanning all market-cap sizes, so removing China doesn't turn the fund into a concentrated bet on a few large markets.avantisinvestors.com
• Actively run against MSCI Emerging Markets IMI rather than tracking it: the mandate overweights lower-valuation, higher-profitability companies.
• One of the stronger builds in the active emerging-markets group we review, on cost and portfolio construction alike.

• VEM Costs 0.49% a year against a 0.65% median for active emerging-market funds, so less of the dividend stream gets skimmed on the way to you.
• The income mandate is written into the prospectus: at least 80% of assets in dividend payers economically tied to emerging markets. Yield is the stated goal, not a byproduct.
• About 60 names, run actively against the MSCI Emerging Markets Index rather than replicating it. Real selection, not a sliver of everything.

Worth knowing

• AVXC Thinly traded next to the giants of the category, so spreads and limit orders matter more on the way in and the way out.
• Launched in 2024, so the live record is short and the risk picture is still forming.
• Leaving China out is a real departure from standard EM exposure, and the value and small-cap tilts add more distance from a plain cap-weighted index.

• VEM Young, small and thinly traded. Spreads can be wide on funds at this size, which makes limit orders and a glance at the bid/ask worth the extra second.
• Cheaper broad EM funds exist: AVEM at 0.33% and DFEM at 0.39%. Neither leads with income, so the fee gap buys you a different job.
• Distributions arrive annually or semiannually, so the income lands in lumps rather than a monthly drip.

Full AVXC profile⁠

Full VEM profile⁠