Mexico ETF Gearing Up for Good Times

August 4th at 6:00am by Tom Lydon

The Mexico exchange traded fund (ETF) had a solid second quarter, in line with the country’s economic performance. But Mexico’s Central Bank is holding off on making any big moves just yet.

Some of the good things happening in the economy lately include:

  • Exports have been vigorous this year, according to bank Governor Agustin Carstens.
  • Jonathan Levin and Andres Martinez for BusinessWeek report that the bank raised its forecast for job creation this year to as high as 625,000
  • The benchmark lending rate will remain at 4.5% until any indications of inflation are apparent, perhaps indicating that it doesn’t expect a major change in price pressures. [U.S. Economy Hits Mexico ETF.]
  • The capital markets have picked up, rebounding off 2009 lows.
  • The economy has demonstrated its revival by expanding more than 4 % from a year earlier after contracting 2.3 % in the last three months of 2009.

World Market Pulse writes for Seeking Alpha that Mexico has also seen auto production, manufacturing and import activity ramping up, too. [Why ETF Providers See Mexico As a Hot Spot.]

On the downside is a widening divide between the country’s haves and have-nots: 32% of the top earners take home 55% of the country’s total income.

For more stories about Mexcio, visit our Mexico category.

  • iShares MSCI Mexico (NYSEArca: EWW)
  • iShares S&P Latin America 40 Index (NYSEArca: ILF) 24.8% Mexico
  • CurrencyShares Mexican Peso Trust (NYSEArca: FXM)
  • Market Vectors Latin America Small Cap (NYSEArca: LATM) 22.8% Mexico
  • SPDRS S&P Emerging  Latin America ETF (NYSEArca: GML) 20.3% Mexico

Read the disclaimer; Tom Lydon is a board member of Rydex|SGI.

Tisha Guerrero contributed to this article.

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.