EWZS: Turnaround Is Possible But I'd Prefer To Wait

Sheen Bay Research
3.52K Followers

Summary

  • EWZS’s poor performance is attributable to the depreciation of the Brazilian Real.
  • The US-China trade war can boost Brazil’s exports to China and help the BRL stabilize.
  • Further interest rate hikes are expected in Brazil due to the rising government debt. Monetary tightening can also support the BRL.
  • EWZS is offering a dividend yield of 4.19%. Some Brazilian peers have a better dividend profile.

Brazil trade cargo container hanging against clouds background

Iskandar Zulkarnaen/iStock via Getty Images

The iShares MSCI Brazil Small-Cap ETF (NASDAQ:EWZS) has performed poorly this year as the Brazilian Real has depreciated. There is some hope of a turnaround, mostly because of the US-China trade war, which will benefit Brazil’s

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