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iShares launches emerging markets small cap fund

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BlackRock’s iShares Exchange Traded Funds (ETFs) business has launched the iShares MSCI Emerging Markets Small Cap Index Fund (nyse arca:EEMS). By adding the new iShares ETF, iShares complements its robust emerging market product suite and enables investors access to the next generation of emerging market growth.

"In the long-term, investors can look to emerging market small cap stocks as the driver of the next wave of emerging market growth," says Russ Koesterich, iShares Global Chief Investment Strategist at BlackRock. "In the short-term, emerging markets may be more defensively positioned than conventional wisdom might suggest.

"Because emerging market small cap stocks offer greater exposure to local consumer sectors –and those sectors are more tied to domestic demand than foreign demand — they should be better insulated from issues facing developed markets today."

Noel Archard, Head of US iShares Product at BlackRock, says: "With the new iShares Emerging Markets Small Cap ETF investors can efficiently access the next generation of small cap companies with 100% local exposure. By combining the new iShares Emerging Markets Small Cap ETF with the broadly diversified iShares MSCI Emerging Markets ETF, investors can gain access to 100% of the investable emerging market universe with no overlap in core holdings."

The iShares MSCI Emerging Markets Small Cap Index Fund is benchmarked to the MSCI Emerging Markets Small Cap Index, which is generally seen as the institutional index standard. It is a float-adjusted market cap weighted index that is rebalanced quarterly. The index’s top three country holdings as of July 31, 2011, are Taiwan (19.86%), Korea (17.35%) and China (16.46%). The top three country sector exposure weightings are consumer discretionary (17.09%), industrials (16.90%) and financials (16.59%).

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