Avantis Responsible Emerging Markets Equity ETF

Avantis Responsible Emerging Markets Equity ETF (AVSE) is an actively managed American Century fund. It owns a broad mix of emerging-market stocks after screening out companies on environmental, social and governance (ESG) grounds. It leans toward smaller, cheaper and more profitable companies. It charges 0.33% a year, the same as its sister fund AVEM but well above index funds such as IEMG at 0.09%.

• Over the year to Oct 27, 2026, AVSE returned +15.8%, 3rd of 9 among similar funds.
• Its worst full calendar year was 2024 (+8.3%); its best was 2025 (+32.5%).
• The deepest fall in its price history was 26.3% (Apr 4, 2022 to Oct 24, 2022), recovered by Mar 7, 2024.

As of Aug 31, 2026, the fund held 2,392 securities; the ten largest made up 21.51% of assets.

• Over the three months to Aug 31, 2026, investors added a net $19.9M (creations minus redemptions, per the N-PORT report).
• Monthly total returns reported for that quarter: +1.19%, -7.84%, +5.12%.

AVSE does not track an index. Its managers at Avantis, part of American Century Investments, pick stocks themselves with the aim of long-term growth. They focus on countries in the MSCI Emerging Markets IMI Index, a broad benchmark of large, mid-size and small companies. They then remove companies that fail ESG screens built from MSCI and Sustainalytics data plus their own judgment. The screens exclude firms with significant revenue from oil and gas, tobacco, cannabis, gambling or civilian firearms. They also exclude thermal coal producers, the bottom 5% on carbon emissions intensity, and companies with weak governance scores.

Each company's starting weight is based on its market value. The managers then shift the weights. They favor smaller companies, companies that look cheap compared with their book value (assets minus debts), and companies that generate more cash from operations relative to book value. They underweight large, less profitable and pricier firms. At least 80% of assets must be in emerging-market stocks.

Two mechanics matter. First, the fund does not have to sell a company that later fails the screens. Second, the fund may create and redeem shares for cash. That can force it to sell holdings and pass taxable gains on to shareholders, so it may be less tax-efficient than some other ETFs. Portfolio turnover was 2%, according to the prospectus filed December 29, 2025.

• AVSE charges 0.33% a year, versus an average of 0.29% for the similar funds below (5th of 9, cheapest first).
• Using the prospectus's standard example, $10,000 invested would cost about $34 in the first year and $419 over 10 years (assuming a 5% annual return).

Its focus on emerging markets, its ESG screens and its lean toward small, cheap stocks make it a higher-risk add-on rather than a portfolio's foundation.

AVSE could add emerging-market stocks to a portfolio built mostly on US shares. As of August 31, 2026, about 21% of the fund was in South Korea and 19% in Taiwan. Its record is short. It launched in March 2022, so it missed the 2008 and 2020 crashes. Its deepest drop, 26.3%, ran from April to October 2022, and it took about 16 months to get back to its peak, in March 2024. Every full calendar year has been positive, and the weakest was 2024 at 8.3%. Someone forced to sell during a drop like 2022's would lock in losses. The yield was 2.89% as of October 27, 2026, paid quarterly. In the SEC's standard example, $10,000 invested would cost about $419 over 10 years. Past results don't predict future ones, and a plan should look at the whole portfolio, not one fund.

Matched by holdings overlap from the latest N-PORT reports.