For added diversification and growth benefits, Kapyrin layers on SPDR S&P Emerging Markets Small Cap ( EWX ). "We see further upside given improvement in macroeconomic fundamentals, subdued inflation, reform momentum and stronger earnings," Heidi Richardson, head of investment strategy for U.S. iShares, wrote recently. "Emerging market (EM) equities present a potential opportunity given higher rates of economic growth than many developed countries and more attractive valuations," the firm wrote in its 2017 investment outlook.