BKEM vs XSOE

BKEMABNY Mellon Emerging Markets Equity ETF

XSOEAWisdomTree Emerging Markets ex-State-Owned Enterprises Fund

In short

BKEM The whole emerging world, priced like an afterthought. BNY Mellon charges 0.11% to hold well over a thousand large- and mid-cap stocks across developing markets. Broad, cheap, and very quiet.

XSOE One screen, applied hard: if a government owns more than 20% of a company, XSOE leaves it out. What is left is emerging markets minus the state champions, with country weights pushed back toward the standard EM mix.

Stated mandate

BKEM The fund is designed to follow the performance of an emerging-markets large- and mid-cap equity index.

XSOE The fund seeks to track the investment results of emerging-market companies that are not state-owned enterprises, defined as companies with no more than 20% government ownership.

Why people hold it

• BKEM 0.11% a year puts it near the bottom of the emerging-markets fee shelf, well under what the typical fund in the category charges.
• Roughly 1,800 holdings, so you own the mid-cap tail of emerging markets, not just the handful of mega-caps that dominate the better-known indexes.
• Buys the full emerging-markets basket rather than carving out China the way top-rated peers XCEM and VEXC do. One allocation decision you do not have to make.
• Plain indexing, run the same way since the 2020 launch: it hews closely to its Solactive benchmark instead of drifting off-mandate.

• XSOE The 20% government-ownership cutoff is an index rule, not a manager's judgment call, and the fund has run on it since its 2014 launch.wisdomtree.com
• 0.32% a year, under the typical fund in its emerging-markets peer group, for a screen most broad EM funds never apply.
• After the state-owned names come out, the index pushes country weights back toward where they started, so it stays a filtered EM portfolio rather than a country bet.wisdomtree.com
• A multi-billion-dollar fund spread across roughly 800 stocks, and it has tracked its index closely.

Worth knowing

• BKEM Thinly traded. Spreads can widen, so order size and timing matter more here than with the category's household names.
• A small fund next to the emerging-markets giants, which is worth knowing if scale and deep secondary-market liquidity are on your checklist.
• Emerging-markets equity carries currency and single-country political swings; 1,800 names spread that around but do not erase it. Distributions come quarterly.

• XSOE Cheaper broad EM shelf-mates exist (BKEM at 0.11%, XCEM at 0.16%). The screen is what you are paying the difference for.
• Government stakes cluster in banks and energy in EM, so removing them shifts the sector mix toward private-sector names. Expect it to behave differently from a plain EM index.wisdomtree.com
• No country is excluded, so China stays in the mix, unlike ex-China peers VEXC and XCEM. It also sits among the more volatile funds in its peer group.

Full BKEM profile⁠

Full XSOE profile⁠