On November 10, 2026, Taiwanese chipmaker Taiwan Semiconductor Manufacturing Company (TSMC) announced a 59.7% year-on-year increase in October revenue. When investing outside US equities, however, it is not enough to track company growth and their country of origin. The ETFobchodník analysis “Without China, With Technology Risk” shows that these companies’ customers, and which existing investment the new fund replaces, also matter for diversifying risk.
Contents – Without China Doesn’t Mean Without Technology Risk:
An Asian Company May Have North American Sales
In the third quarter of 2026, TSMC generated 79% of its revenue from customers based in North America. India’s Infosys reported 54.6% of its revenue from that region over the same calendar period, while only 2.8% came from India. A company’s Asian classification therefore doesn’t mean its sales rely mainly on the local market. An investor may change the geographic makeup of a portfolio, yet a significant share of the revenue of the companies purchased will continue to come from customers based in North America.
Leaving out Chinese stocks also doesn’t remove business ties with China. In the same quarter, TSMC received 5% of its revenue from Chinese customers. What the company sells matters as well. At TSMC, 68% of revenue came from high-performance computing, meaning high-powered computers and servers. That area is broader than artificial intelligence (AI) alone, so this share cannot be equated with AI revenue.
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Profit Growth Doesn’t Necessarily Raise the Share Price
The outcome of an investment also depends on the price the investor pays for the business. The price-to-earnings (P/E) ratio expresses how much a unit of profit costs. If the price already reflects high expectations, even a growing company can deliver a weak result when the market lowers the amount it is willing to pay for its earnings.
With an illustrative 10% growth in earnings per share and a simultaneous 15% drop in P/E, the share price falls by 6.5%. In this case, higher profit does not offset the lower valuation. This is a model calculation before dividends, currency effects and costs, not historical performance or a forecast. Business growth must therefore be compared with the expectations already built into the purchase price.
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What the New Fund Replaces Matters Too
Consider a portfolio worth EUR 10,000, in which technology stocks make up EUR 3,000, or 30%. The investor moves EUR 1,000 into a new basket of stocks with half the technology share. The new investment thus adds EUR 500 of technology stocks. This illustrative example does not represent the current composition of EMXU or a recommended investment size. The total portfolio value does not change, and the model does not account for price movements or costs.
If the purchase is paid for by selling purely technology stocks, the technology share falls to 25%. If all the original portfolio components are reduced proportionally, it reaches 32%, and if existing cash is used, 35%. The same purchase can thus either reduce or increase technology concentration, depending on what it replaces. The calculation measures the share of one sector, whereas overall risk is also affected by currencies, countries and how investments move relative to each other.
A Euro Listing Alone Doesn’t Remove Currency Risk
The analysis works with the Amundi exchange-traded fund (ETF) with the ticker EMXU, which invests in emerging-market stocks excluding China. It tracks an index that, when selecting companies, also takes into account environmental and social criteria and the quality of their governance. ETFobchodník offers it under the symbols EMXU.XETRA and EMXU.LSE. The former trades on Xetra in euros (EUR), the latter on the London Stock Exchange in US dollars (USD). It is the same fund class. Buying in euros alone
An investor should first decide which dependency they want to reduce and compare the current composition of the new fund with what they already own. It then makes sense to assess the purchase price, costs and the period for which the money can be invested. The ETFobchodník analysis “Without China, With Technology Risk” examines these connections in more detail. Its practical starting point is to assess the new fund together with the investment it will replace, and to recalculate its impact on the entire portfolio.
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Jakub Matis, analyst at ETFobchodnik.com
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