The Global Insider: May Country Rankings

 |  Includes: ACWI, EIDO, EPU, EWG, EWI, EWJ, EWP, TUR
by: Accuvest Global Advisors


Value factors, which have been the best driver of performance over the last 12 months, are the only factor group to make a positive contribution this year.

Select emerging markets are quickly moving up the rankings with accelerating momentum and improving fundamentals.

The three best performing markets in 2013 (US, Germany and Japan) are all trailing the MSCI ACWI on the year.

This is an in-depth review of the Accuvest Global Advisors country ranking model and strategy implementations. The Accuvest Country Ranking Model is used to evaluate country equity markets and determine relative attractiveness of countries within the MSCI All Country World Index. Accuvest holds the longest verified track record in the industry for building Global Equity strategies through the sole use of single country ETFs.

Highest Ranked Countries for May

Global Landscape

  • Country returns were historically tight in April showing a narrow return spread of only 13.77% from best to worst. Italy and Israel have been the strongest developed markets through the first four months, with both up over 16%.
  • The three worst performing countries last year (Peru (NYSEARCA:EPU), Indonesia (NYSEARCA:EIDO) and Turkey (NYSEARCA:TUR)) are leading the way for emerging markets this year. The three are up double digits, with Indonesia leading the way at 22.55%.
  • The three best performing markets in 2013 (US, Germany (NYSEARCA:EWG) and Japan (NYSEARCA:EWJ)) are all trailing the MSCI ACWI on the year. The momentum factors are continuing to show signs of mean reversion across countries.
  • Value factors, which have been the best driver of performance over the last 12 months, are the only factor group to make a positive contribution this year.

Country Ranking Model

  • Spain (NYSEARCA:EWP) and Italy (NYSEARCA:EWI) dropped slightly in the latest model and were replaced by Germany in the top 6. China and the United States maintained their positions at the top of the model.
  • Select emerging markets are quickly moving up the rankings with accelerating momentum and improving fundamentals. Turkey appears to be on the verge of cracking the top 5.

The Global Landscape

Data is as of 4.30.14; Source Accuvest Global Advisors

  • The MSCI All Country World Index (NASDAQ:ACWI) was up 0.95% in April. The range of returns was 13.77% from best to worst performing country and the average country was up 1.40%
  • Japan has been the 2nd worst performing country on the year, down -8.04% in USD.
  • Turkey, which was down -26.76% in 2013, has reversed course in 2014. They were the best performing country in April and are now up 12.5% on the year.
  • Latin America is showing signs of recovery, most notably from Peru and Brazil. The region is up 3.01% YTD with Peru leading the way, up 11.64%.

Country Return Drivers

  • Factor returns were relatively flat across all four groups in April. Valuation factors showed the most positive trend on the month, and have been the best performing for the year.
  • The momentum factors continued to have a negative drag on country selection. The best performing countries from last year (US, Germany, Japan) are all trailing the ACWI this year.

Data April 2014; Source Accuvest Global AdvisorsClick to enlarge

Country Ranking Model

Source Accuvest Global AdvisorsClick to enlarge

Model Highlights


Turkey climbed 18 spots to 10th overall. Turkey has been the best performing market over the last 3 months, up 20.2%. Fundamentals are also improving across a variety of factors.

Peru moved up 11 spots from 25th to 14th overall. Similar to Turkey, Peru is showing improving momentum and fundamentals. Valuation and risk remains higher than average.


Russia (NYSEARCA:RSX) continues to drop, despite having the cheapest valuation in the model. They are now ranked 21st overall and have the worst momentum and 2nd highest risk in the entire model.

Japan fell 9 spots and is now ranked 28th in the model. Momentum has been the biggest drag on Japan, which has been the second worst performing country over the last 3 months. They are down -5.0% during that period.

Model Factor Groups











United States








United Kingdom

South Korea


South Africa



South Africa




Click to enlarge


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Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

Business relationship disclosure: Accuvest Global Advisors is a California based RIA This article was written by David Allen, one of our Portfolio Managers. We did not receive compensation for this article , and we have no business relationship with any company whose stock is mentioned in this article.