Country-based exchange traded funds (ETFs) have boomed in popularity as their individual economies have flourished. In the past, investors generally looked to the U.S. for investment opportunities before they searched abroad. However, in recent years, this hasn’t been the case. As international growth exceeds domestic growth, it’s wise to consider other global regions and country-specific ETFs.
The key is to first identify whether a definable trend is in place. An easy way to do this is to look at the recent 200-day moving average of an ETF that represents the country you’re considering. Then, as Richard Shaw for QVM Group notes, it’s important to understand the underlying fundamentals of a country’s economy, such as the country’s trade-to GDP ratio.
The opinions and forecasts expressed herein are solely those of Tom Lydon, and may not actually come to pass. 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.