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Thanks to renewed optimism from many investors, some are beginning to cycle back into emerging market equities this year. While this trend is long overdue for many U.S. centric investors, there are likely some limitations to the process as well. That is because many investors focus in on large cap ETFs for their emerging market exposure, leaving portfolios heavily allocated to just a few countries (read Top Three BRIC ETFs).

In fact, most emerging market funds are deeply, if not entirely, concentrated in four nations; Brazil, Russia, India, and China. These four, popularly known as the BRIC bloc, represent some of the largest and most prolific developing nations in the world today, widely regarded by many as future economic superpowers.

Yet while pretty much every investor should have some exposure to these nations in their portfolio, a strategy that solely focuses on these countries is missing out on a number of other markets—both large and small—that can provide solid levels of growth for years to come.

Countries such as Indonesia, Mexico, or South Africa are beginning to rival some of the BRIC members in terms of growth and investment strength, although they are often overlooked in favor of their larger counterparts.

Meanwhile, smaller markets around the world, such as Malaysia, Poland, or Peru, are also surging in importance, although their total size is tiny compared to the trillion dollar economies of the BRICs. This suggests that these nations beyond the BRIC could be interesting picks for investors looking to round out their emerging market exposure and develop a more complete global portfolio (read Five ETFs to Buy In 2012).

In light of this, we have sought to provide investors with three ETFs that either scale back their exposure to the BRIC bloc, or eliminate it entirely. Additionally, the three funds all look to hold assets across many nations, ensuring that trouble in a single country will not bring down any of the funds on this list.

So for investors who are curious about ways to further diversify emerging market exposure, any of the following funds could make for interesting choices:

WisdomTree Emerging Markets Small Cap Dividend Fund (DGS)

Many of the largest emerging market stocks, by market cap, are in the world’s biggest emerging markets. These companies have thoroughly exploited and dominated their home countries over the years often thanks to favorable government policies or a lack of real competition.

Yet, small caps and firms in smaller nations haven’t had the same privileges, ensuring that the top companies in this space are more spread out across nations. Furthermore, when investors add in the dividend metrics that underlie the WisdomTree methodology, the playing field becomes even more level (read Five Cheaper ETFs You Probably Overlooked).

As a result, DGS could be an interesting choice to spread out emerging market exposure across nations besides the BRIC. The product puts about one-fourth of its assets in Taiwan, and then 10% each in South Africa and Thailand to round out the top three.

In fact, BRIC countries make up about 13% of the total portfolio, suggesting a much more diversified picture that includes smaller markets. Additionally, the product holds about 530 securities and puts just 1.13% in its top holding, implying that company specific risk is not much of an issue either.

EG Shares Emerging Markets Consumer Titans ETF (ECON)

Thanks to the fragmented and still budding developing nation consumer market, BRIC firms have been unable to dominate this space either, opening up assets to a host of other nations. This trend could also be due to varying local tastes which make it hard for companies to dominate from a transnational perspective as well. Thanks to this, consumer companies can be a go to spot for investors looking for growth stocks in emerging markets without a heavy focus on the BRICs (read Top Three Emerging Market Consumer ETFs).

ECON holds 30 securities in total while charging investors 85 basis points a year in fees. South Africa (16%), Mexico (12%), and Chile (10%) make up the top three while growth securities make up a majority of the holdings as well.

BRIC assets make up about one-quarter of the total fund, suggesting that there might be some overlap between this fund and other, broader emerging market ETFs. However, it should be noted that many consumer stocks, due to their small size, receive small weights in many emerging market ETFs suggesting there will be limited ‘double dipping’ in this particular case.

Guggenheim Frontier Markets ETF (FRN)

For a true play that goes beyond the BRIC markets, investors should take a closer look at the frontier nations. These countries are generally considered a subset of emerging markets but have higher risk than their more developed cousins.

In addition to higher risks, these nations also generally have lower levels of market capitalization and liquidity, making large institutional purchases hard if not impossible. Yet, while this may make these markets off-limits to large investors, smaller independent investors can still play the markets as a solid way to avoid BRIC exposure in the emerging world (see Three Overlooked Emerging Market ETFs).

FRN is a solid, global choice in this space, holding 40 securities in total while charging investors 65 basis points a year in fees. Volume is also superb, as the product sees average daily volume of about 54,000 shares a day and has AUM over $130 million.

Stocks from Chile take the top spot in the fund at roughly 37% of assets, followed by Colombia (15.2%), and Egypt (10.3%) to round out the top three. However, it should be noted that the fund does see a heavy concentration from an individual security perspective, putting nearly one-fourth of its total in the top three holdings.

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