China’s Redirected Foreign Investment Could Help Latin America’s ETFs

1) Diversifying out of their $1.7 trillion in foreign-exchange reserves, mostly U.S. treasury bonds and fixed-income assets

2) Gaining control of energy reserves

Just as other dollar investors are, CIC is taking a hit as the second-largest holder of U.S. Treasury securities.

Latin American ETFs might benefit from this move toward diversification:

• iShares MSCI Brazil Index (EWZ): up 0.8% year-to-date
• iShares S&P Latin America 40 Index Fund (ILF): up 2.8% year-to-date
• SPDR S&P Latin America (GML): up 0.6% year-to-date