ETF Chart of the Day: South Korea

March 22nd at 2:00pm by Paul Weisbruch, Street One Financial

Yesterday we talked about recent weakness in South Korea’s equity market, where EWY (iShares MSCI South Korea, Expense Ratio 0.59%) has fallen eleven out of the last twelve trading sessions, closing below its 200 day MA yesterday for the first time since mid-November of last year. [ETF Chart of the Day: Emerging Markets]

EWY is top heavy Samsung Electronics, at 22.05% of the overall portfolio, with secondary exposure to names like Hyundai Motor (5.33%), POSCO (3.71%), Hyundai Mobis Company (3.44%), and Shinhan Financial Group Company (2.52%). With about $3.1 billion in assets under management and having debuted in the year 2000, the fund remains the giant in the space in terms of granting exposure to the South Korean equity market.

FKO (First Trust South Korea AlphaDEX, Expense Ratio 0.80%) is another alternative here, utilizing the proprietary AlphaDEX methodology which is known for a methodical re-balance in order to keep portfolio holdings in equal weight with each other over time as stock prices run or fall. Lesser known names such as Amore Pacific Group, SK Holdings Company, SK Innovation Company, SK Telecom Company and CJ Corporation are top holdings in that fund at the moment and the ETF itself is still very small, having debuted in 2011 and only averaging about 2,400 shares traded on an average daily basis (asset base is currently $2.5 million).

Other ETFs that are not necessarily devoted to South Korea, but have sizable exposure to the country’s equity market include FPA (First Trust Asia Pacific Ex-Japan AlphaDEX, Expense Ratio 0.80%), with a 36.77% slice allocated to South Korea, PAF (PowerShares FTSE RAFI Asia Pacific ex-Japan, Expense Ratio 0.49%), and EMDI (iShares MSCI Emerging Markets Consumer Discretionary Sector, Expense Ratio 0.66%) and being that the country’s equity market seems to be in play here on a recent sell-off on heavy volume.

iShares MSCI South Korea Index Fund

For more information on Street One ETF research and ETF trade execution/liquidity services, contact Paul Weisbruch at pweisbruch@streetonefinancial.com.