Perhaps one of the reasons Taiwan’s exchange traded fund (ETF) generally has been a strong performer is because Taiwan’s economy is in such good shape. The economy has had three years of interest-rate increases to contain inflation, according to the Central Bank Governor. On Sept. 20, the central bank increased its benchmark interest rate for the 13th quarter in a row. To keep the healthy trend going, the central bank is considering raising interest rates again, reports The China Post news staff. Another interest rate reduction could benefit iShares MSCI Taiwan Index (EWT) that is currently up 19.9% year-to-date.
In other ETF news for Taiwan, a fund-management firm, Primasia Investment Trust, plans to launch an ETF that holds 50 global semiconductor stocks in late March or early April, reports Alex Pevzner for MarketWatch. It will be Taiwan’s first ETF that also tracks foreign stocks and provides investors with exposure to the global semiconductor industry. Initially, the ETF will be denominated in Taiwan dollars, but if the island’s central bank approves, it could then switch over to U.S. dollars. It will hold nine Taiwan semiconductor companies, and the remaining 41 will be in the U.S., South Korea and Japan.
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.