Recent pullbacks aside, Latin America’s ETFs are still worthy of a little attention. Several of them, in fact, remain above their 200-day moving average and have held up relatively well through the market’s tumult.
Only three Latin America-focused ETFs have a accrued a five-year track record, and their average returns are an impressive 305%, writes Nick Sudbury for IFAonline.
The iShares MSCI Brazil (NYSEArca: EWZ) was up 389% over the five-year period. EWZ has 78 holdings and an expense ratio of 0.74%. The largest holding is the oil producer Petrobras, which is 20% of the portfolio. The fund has 51% exposure to energy. Brazil’s economy is forecast to expand 6% this year, aided by its large reserves of natural resources and a growing middle class.
The iShares S&P Latin America Index (NYSEArca: ILF) was up 317% in five years. The fund has an expense ratio of 0.5% and very liquid. Country allocations include Brazil, 63%; Mexico, 22.4%; and Chile, 11%.
The Global X/InterBolsa FTSE Columbia 20 Index (NYSEArca: GXG) has been one of the top Latin American funds in the last year, with a return of 87%. Colombia makes up only 1% to 3% of the Latin American funds, despite being one of the largest economies in South America. The country is classified as a frontier market, but it has a fairly diversified economy and the market index has been less volatile than the S&P 500.
- SPDR S&P Emerging Latin America (NYSEArca: GML)
- iShares MSCI Chile Index (NYSEArca: ECH)
- iShares MSCI Mexico ETF (NYSEArca: EWW)
- iShares MSCI All Peru Capped Index (NYSEArca: EPU)
Max Chen contributed to this article.