Van Eck Dives Into The Gulf With New ETF

July 25th at 2:00pm by Tom Lydon

Van Eck is trekking out into frontier markets with the launch of their exchange traded fund (ETF).

Market Vector Gulf States (MES) gives easy access to the gulf states of Bahrain, Kuwait, Oman, Katar and United Arab Emirates.

The fund’s expense ratio is 0.50%, with total net expenses at 0.98%. The ETF tracks the Dow Jones GCC Titans 40 Index. The Gulf region has been on a run, thanks to high energy prices. The spending on infrastructure and urbanization is growing and sustainability will only be known in the future.

The top country weightings are: Kuwait, 52.3%; United Arab Emirates, 25.9% and Qatar, 14.9%. Banks are the most well-represented sector, with 38.5% of the holding. Financial services follow at 21.6%; real estate is 10.5%.

This fund comes on the heels of the WisdomTree Middle East Dividend Fund (GULF), which shares a similar makeup. The top countries are Kuwait, 27.2%; United Arab Emirates, 16.9%; Qatar, 16.5%. Financials is the top sector, with 51.6%, while telecommunications comes next with 24.7% of the holdings.

The Middle East has been a hot place lately, for both temperature and ETF attention:

  • iShares MSCI Israel Capped Investable Market Index (EIS)
  • iShares MSCI Turkey Investable Market Index Fund (TUR)
  • SPDR S&P Emerging Middle East & Africa (GAF)
  • Claymore/BNY Mellon Frontier Markets ETF (FRN)

The opinions and forecasts expressed herein are solely those of Tom Lydon, and may not actually come to pass. Mr. Lydon serves as an independent trustee of certain mutual funds and ETFs that are managed by Guggenheim Investments; however, any opinions or forecasts expressed herein are solely those of Mr. Lydon and not those of Guggenheim Funds, Guggenheim Investments, Guggenheim Specialized Products, LLC or any of their affiliates. Information on this site should not be used or construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any product.