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XMM is a Canadian-listed iShares ETF that tracks the MSCI Emerging Markets Minimum Volatility Index. Its holdings are 99% EEMV, the US-listed version of the same ETF.

While EEMV tracks its index fairly well, XMM is completely different, which is very strange since all it holds is EEMV.

Sample calendar performance:

+------+------------+-------+-------------+
| Year | MSCI Index |  XMM  | "Benchmark" |
+------+------------+-------+-------------+
| 2015 | -11.67     | 4.93  | 5.48        |
| 2016 | 4.36       | -0.86 | 0.31        |
| 2017 | 27.21      | 18.27 | 18.40       |
| 2018 | -5.38      | 2.14  | 2.71        |
+------+------------+-------+-------------+

While the tooltip for that "benchmark" does show enter image description here

the numbers look nothing like that actual index (linked above), nor its underlying ETF EEMV. How can this be explained?

  • Are they both listed in the same currency? – quid Sep 6 '19 at 22:51
  • XMM is listed in CAD and EEMV is listed in US. Could that explain such a wide difference in returns? – Asik Sep 7 '19 at 2:53
  • I'm seeing that over the course of the year 2016, the Canadian dollar became 3.49% stronger, relative to the US dollar. So my question is how XMM did so much better than the benchmark in 2016: instead of merely gaining 0.31% of its value in USD, it managed the greater feat of losing only 0.86% of its value in CAD. – Tanner Swett Sep 8 '19 at 2:27
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Turns out I made the mistake of comparing it to the USD version of the index; the CAD version (for gross returns, not net returns) lists the exact same numbers as XMM's benchmark.

I didn't run the numbers, but the differences are presumably attributable to fluctuations in currency and management fees.

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