Many equity investors seeking technology exposure default to QQQ, which tracks the 100 largest non-financial Nasdaq companies. But the real growth opportunity lies elsewhere: emerging markets, where internet penetration remains low but expansion is accelerating sharply.
The thesis is straightforward. In 2024, the International Technology Union estimated 93 percent of high-income countries had internet access versus just 27 percent in low-income countries. Yet low-income markets are growing at 8.5 percent annually—two and a half times the 3.4 percent rate in developed economies. As populations transition online, demand for e-commerce, digital payments, and internet platforms will surge in regions where U.S. tech giants have minimal presence or no priority.
The Emerging Markets Internet ETF (EMQQ) directly targets this opportunity. The fund invests in technology companies operating in Asia, Latin America, and Africa with market capitalizations of at least $1 billion, average daily liquidity exceeding $1 million, and at least 50 percent of revenue from internet or e-commerce activities. South Asia—particularly India—Latin America, the Middle East, and sub-Saharan Africa represent the fastest-growing digital markets globally.
For portfolio managers overexposed to mega-cap U.S. tech, EMQQ provides concentrated exposure to the structural growth story that QQQ has already priced in. The risk: currency volatility and regulatory uncertainty in emerging markets. The opportunity: decades of internet penetration upside in markets where smartphone adoption remains the dominant growth driver.
