Single-Country ETFs: Year-to-Date Winners

Most investors wish that they could start 2008 over. A re-vote or a "re-do" would have provided many with an opportunity to sell some winners at higher prices.

(How many did not sell in 2007 to avoid taxable gains? How many now wish they had thought differently about protecting against downside risk? Read more about protecting against loss in this article.)

Obviously, there's little use crying over spilled milk. It's better to consider what is working and/or what may begin to work in the weeks and months ahead.

Most single-country funds have been walloped by double-digit losses. A major league exception? The iShares Canada Fund (EWC) has put forward a volatile, yet less egregious, -4% YTD.

As I pointed out a few days ago, however, EWX is still "joined at the hip" with the U.S. Select Energy SPDR (XLE).

In contrast, there are a few single-country ETFs that are actually flat or slightly up in 2008. What's more, some of them still have bullish fundamentals and technicals.

The iShares MSCI Brazil Index Fund (EWZ), for instance, has been flat year-to-date. This is pretty impressive when one considers that EWZ still remains above its long-term trend and has a P/E on Yahoo Finance of 12.5.

Keep in mind, many economists maintain that the world economy will grow in spite of developed country problems. This could mean that emergers like Brazil may fare "well enough" when stock assets struggle, while Brazil may could outperform if stock assets regain their footing.

Latin America, in general, has been surprisingly "safer" as of late. The iShares MSCI Mexico Index (EWW) and the iShares MSCI Chile Index (ECH) have offered respective 2008 returns of 1% and 7.5%.

And then there are several victors in the deep value arena; specifically, the iShares Taiwan Fund (EWT) is up 2% while the iShares Switzerland Fund (EWL) has a small loss of -2%. Compared to other country funds in 2007, EWT and EWL were relative underperformers. In 2008, however, they have been relative outperformers, getting the better of the EAFE Index (EFA) for Europe, AustralAsia and the "Far East."

Comments

[kkin365]

What is EWX? You mentioned it without commenting

[huangthomas]

Taiwan is the land free of toxic brew, CDO. If Ma is elected President, across the straight relation with China is expected to improve substantially and Chen Sui-Bian, a demagogue, will walk into the history.

[Commodiwannabe]

I'm working on a paper on a similar subject and could use some help... How fair would it be to say that some of these gains in deveoping countries is a direct result of a recent bubble/increase (whatever you want to call it) in Commodities since deveoping countries are typically less diversified and dependant upon mainly an agriculture base or energy/metal resources for revenues?

[Indexor]

kkin365 - Mr. Gordon meant EWC not EWX. X and C are next to each other on the keyboard. It was simply mis-keyed.

[Kunst]

Single-country ultra-shorts, year to date (3/20/08):
EWV: Japan: up 15%
EEV: Emerging markets: up 23%
EFU: Europe: up 26%
FXP: China: up 42%

In the last month, these range from +3% to +17%;
in the last week, +3% to +12%.

Don't swim against the tide.