FEMS vs QEMM

FEMSDFirst Trust Emerging Markets Small Cap AlphaDEX Fund

QEMMBState Street SPDR MSCI Emerging Markets StrategicFactors ETF

In short

FEMS Emerging market small caps, chosen by First Trust's AlphaDEX growth-and-value rules instead of ranked by size. A narrow, off-the-beaten-path slice of EM that has been running since 2012.

QEMM Instead of betting on one factor, QEMM buys value, quality and low volatility across emerging markets at once, packing roughly 800 stocks into a single MSCI factor-blend index for 0.30% a year.

Stated mandate

FEMS The Fund seeks to track, before fees and expenses, the price and yield performance of the Nasdaq AlphaDEX® Emerging Markets Small CapTM Index.

QEMM The fund seeks to track the MSCI Emerging Markets (EM) Factor Mix A-Series Index.

Why people hold it

• FEMS Goes small in emerging markets: roughly 220 stocks, so no single name or state champion carries the fund.
• AlphaDEX picks and weights by growth and value rank, not market cap, so the biggest company in the index isn't automatically the biggest position.ftportfolios.com
• Live since 2012, with the same rules-based index mandate through multiple EM cycles. Pays quarterly.
• Holdings are spread widely enough that the portfolio reads as a genuine small-cap basket rather than a handful of bets.

• QEMM One ticket, three tilts: the MSCI EM Factor Mix A-Series Index blends value, quality and low volatility, so no single style has to be in favor for the strategy to run as designed.ssga.com
• At 0.30% a year it undercuts the typical fee in the multifactor emerging-markets crowd, and the portfolio is built by index rules rather than a manager's hunch.
• Running since 2014 with roughly 800 holdings and State Street behind the wrapper: a long-lived option in a corner of the market where niche products often quietly close.
• The low-volatility sleeve is the tell. This is emerging-markets exposure assembled to smooth the ride, not to chase the hottest single factor.ssga.com

Worth knowing

• FEMS Cost is the sore spot: 0.80% a year, well above EM factor peers such as EMGF (0.26%) and AVES (0.36%). That gap compounds against you.
• Thinly traded. Spreads can widen, and large orders can move the price more than in the big EM funds.
• Small caps plus emerging markets is a bumpy combination, and this has been among the more volatile funds in its peer group.

• QEMM Trades thinner than the category's household names, so spreads can be wider. That bites most on large or hurried orders.
• Splitting the bet three ways dilutes each factor by design, so the portfolio rarely looks or moves like a plain-vanilla emerging-markets index.
• Distributions land once or twice a year rather than quarterly, and peers such as EMGF carry a lower fee for multifactor EM exposure.

Full FEMS profile⁠

Full QEMM profile⁠