EWW: Hawks May Prevail, Alpha Not In The Cards

Jun. 13, 2022 7:41 AM ETiShares MSCI Mexico Capped ETF (EWW)
Vasily Zyryanov profile picture
Vasily Zyryanov
1.82K Followers

Summary

  • EWW is a rather liquid, large-AUM option to express a bullish sentiment on a cohort of the principally large-size Mexican equities.
  • Persistent inflation hints more aggressive rate hikes are in the cards, though this is not necessarily bullish for the peso, as higher rates can trigger a recession.
  • Though I appreciate the comfortable valuation of the EWW holdings, I do not believe that is enough to secure consistent gains in case of economic growth grinding to a halt.
  • The Hold rating is maintained.
Flag of Mexico with blue sky

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The iShares MSCI Mexico ETF (NYSEARCA:EWW) is a rather liquid, large-AUM option to express a bullish sentiment on a cohort of the principally large-size Mexican equities, as well as on the national currency, the MXN.

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Vasily Zyryanov profile picture
1.82K Followers
Vasily Zyryanov is an individual investor and writer.He uses various techniques to find both relatively underpriced equities with strong upside potential and relatively overappreciated companies that have inflated valuation for a reason.In his research, he pays much attention to the energy sector (oil & gas supermajors, mid-cap, and small-cap exploration & production companies, the oilfield services firms), while he also covers a plethora of other industries from mining and chemicals to luxury bellwethers.He firmly believes that apart from simple profit and sales analysis, a meticulous investor must assess Free Cash Flow and Return on Capital to gain deeper insights and avoid sophomoric conclusions.While he favors underappreciated and misunderstood equities, he also acknowledges that some growth stocks do deserve their premium valuation, and its an investor's primary goal to delve deeper and uncover if the market's current opinion is correct or not.

Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

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