Both VXEEM and VXEWZ were higher last week despite their underlying markets moving higher. EEM was up 0.72% and EWZ was 0.53% higher. It was so odd that I double checked my numbers and then triple checked them. Over the past few months emerging markets have been on a tear to the upside. The Brazilian market continues to reflect signs of an economic recovery and there was recently a rate cut to add liquidity to the market. However, when the implied volatility of options on equity markets ticks higher it can be the first signs of concerns about more upside. The futures curves are pretty steep as well and mostly moved higher along with the indexes last week. This is another sign of growing concerns about the near term prospects for emerging markets. We shall see in the next couple of months if the volatility traders or emerging market bulls have it right.