Eleven For '11: Emerging Markets ETFs To Watch In The New Year

Alright, we all know that for the most part, 2010 has been a stellar year for most emerging markets ETFs. That being said, the journey hasn't been without its bumps and many emerging markets ETFs are going to post gaudy stats at the end of this year that don't reflect how poorly they traded over the year's final six to eight weeks. Perhaps more than any of the "Eleven for '11" lists we've done to this point, this one will illicit strong feelings and may be a bit controversial, but it may be the most important one. Without further ado, here are 11 emerging markets ETFs to watch in 2011. 1) Vanguard Emerging Markets Stock ETF

: On the list because its rivalry with the iShares MSCI Emerging Markets Index Fund

is getting more compelling by the month. This maybe the best ETF rivalry on the market today. 2) iShares MSCI Peru All Capped Index Fund

: EPU is probably going to finish 2010 as the best-performing EM ETF, a run that has been bolstered by soaring gold, silver and copper prices. Peru's GDP outlook is solid for 2011 and if those metals continue to climb, EPU may be in for another stellar year. 3) iShares MSCI Brazil Index Fund

: We could really say any Brazil-focused ETF that is heavy on Petrobras

is worth watching in 2011. The Brazilian oil giant is once again projected by some analysts to lag the overall Brazilian market and one has to wonder at what point does this hurt large-cap Brazil-specific ETFs? Beyond that, further rate tightening in China, Brazil's biggest trading partner, could pressure EWZ and other ETFs that track South America's largest economy. 4) iShares FTSE/Xinhua China 25 Index Fund

: This may come as a surprise to some, but if FXI doesn't get its act together this week, there's a fair chance the ETF will finish 2010 in the red. An obvious choice to be sure, FXI will be in play once again in 2011 as Beijing continues its efforts to rein in inflation. 5) Guggenheim China SmallCap ETF

: HAO has been far more reliable than FXI in 2010 for China bulls, but this baby gets thrown out with bathwater when China raises rates, making this fund another to watch in 2011. 6) Market Vectors Indonesia ETF

: Speaking of rate hikes, Indonesia probably needs a couple. IDX has not impressed late this year making its year-end stats a tad deceiving. Still, the outlook for Indonesian equities in 2011 is fairly rosy. 7) WisdomTree India Earnings ETF

: Another example of an ETF with a glum end to an otherwise solid year. India's growth outlook is stellar, but inflation is a major concern here as well. 8) iShares MSCI Chile Investable Market Index Fund

: A direct play on copper, ECH could be a prime beneficiary from the creation of new ETFs backed by physical copper. The copper theme also makes ECH a China play and that's somewhat concerning heading into 2011. 9) iShares MSCI Turkey Investable Market Index Fund

: A prime example of really ugly price action to end 2010, TUR heads into the new year looking very vulnerable. Earlier this month, Morgan Stanley proffered a GDP outlook for Turkey that lags a swath of other emerging markets. Down may be the path of least resistance with TUR for the next several months. 10) Market Vectors Russia ETF

: RSX should be a big winner under the $100 oil scenario, but what will Russia do about diversifying its economy in 2011? A positive answer to that question could be a catalyst for RSX in the new year. 11) SPDR S&P Emerging Europe ETF

: All things considered, GUR has put in a nice run in 2010 despite Europe's sovereign debt woes, perhaps indicating what appear to be the riskiest destinations for investors in Europe are far more reliable than developed markets. The big question is will that theme continue in 2011?