The iShares MSCI Emerging Markets ETF (EEM) has surged 25% so far in 2026, overtaking major U.S. benchmarks including the Invesco QQQ Trust (NASDAQ: QQQ), the State Street SPDR S&P 500 ETF Trust (SPY), and the State Street SPDR Dow Jones Industrial Average ETF Trust (DIA).
The Invesco QQQ Trust, which tracks the tech-heavy Nasdaq-100 index, has been one of the market’s defining winners over the past decade, surging more than 616%.
Jack Altman, general partner at venture capital firm Benchmark and brother of OpenAI CEO Sam Altman, acknowledged the index’s dominance in a post on X.
“QQQ has been a 6.5x net in the last 10 years… tough hurdle to beat,” Altman wrote.
Despite QQQ’s long-term record, emerging markets are stealing the spotlight in 2026, with Asian markets in particular delivering outsized returns driven by the artificial intelligence trade.
Yardeni Research recently highlighted the strength of the rally, noting that equities in South Korea and Taiwan have surged 87.2% and 52.4% year-to-date, respectively, fueled by robust semiconductor earnings and rising AI-related demand.
Taiwan’s stock market has overtaken India’s to become the fifth largest in the world, trailing the U.S., mainland China, Japan, and Hong Kong, boosted largely by a sharp rally in Taiwan Semiconductor Manufacturing Co.
According to Koyfin data, Taiwan Semiconductor Manufacturing Co. alone accounts for 14.28% of EEM’s portfolio, and combined with Samsung Electronics and SK Hynix, semiconductor companies now make up nearly 28% of the ETF’s total holdings.
SK Hynix surged more than 10% in Seoul trading on Wednesday, pushing the company past the $1 trillion market capitalization milestone, while Samsung Electronics climbed 6.4%.
“Markets with limited exposure to tech hardware are increasingly being overshadowed by tech hardware-heavy markets such as Taiwan and Korea,” Yi Ping Liao, a fund manager at Franklin Templeton, told Bloomberg.
The Invesco QQQ Trust also carries heavy AI exposure, with Nvidia, Apple, Microsoft, Amazon, and Micron Technology collectively making up more than 30% of its portfolio.
Yardeni Research has highlighted how the All Country World ex-U.S. MSCI has already outperformed the U.S. MSCI over the past year for the first time since the 2000s.
The firm has reiterated its “Go Global” investment strategy, noting that “the rest of the world might soon start outperforming the US again on expectations that the end of the war is in sight.”
On Stocktwits, retail sentiment around EEM was in “bullish” territory amid “high” message volumes, while QQQ sentiment was also “bullish” but message volumes remained “low.”
QQQ has rallied 40% over the last year, while EEM has surged 48% over the same period.
