How to Play Poland's Handsome Recovery With ETFs | ETF Trends

Poland’s economy and related exchange traded funds (ETFs) have sidestepped the reaches of recession and the country may end up as one of the few European countries to report a positive growth for the year.

The Polish economy stepped lightly throughout the global recession because its economy was not as heavily invested in exports compared to its other European counterparts, remarks Carter Dougherty for The New York Times. As a result, the emerging economy has seen a few positive developments:

  • Poland’s GDP increased by 1.1% in the second quarter by the same period year-over-year, a result well above the expected 0.5% growth, writes Polya Lesova for MarketWatch.
  • The Polish zloty jumped 1% against the euro and 1.1% against the dollar on the good economic report.
  • The Danske Bank expects the economy to grow between 1.0% and 1.5% for 2009.
  • The Polish Central Bank kept interest rates at 3.5%, citing increase in retail sales and rise in economic sentiment as indicators signaling an improvement in the economy.
  • Poland’s labor market remains strengthened by foreign investment. Many big-name global manufacturers are setting up shop in Poland, which has helped bolster the employment rate.

On the flip side, Ryszard Petru, chief economist at BRE Bank in Warsaw, estimates unemployment will hit 9.9% by the end of 2009, up from 7.1%. The Central Bank also warns that reduced lending, more notably to the corporate sector, may diminish overall economic growth.

While there currently isn’t a Poland single-country ETF, there are a selection of emerging market/frontier market ETFs that do have Poland as a large component. These types of region-specific ETFs also have the added benefit of spreading risk between the economic outcomes of countries included in the ETFs.

  • Claymore/BNY Mellon Frontier Markets (FRN): up 35.6% year-to-date; Poland is 15.1%


  • SPDR S&P Emerging Europe (GUR): up 46.6% year-to-date; Poland is 12.2%


For more information on emerging markets, visit our emerging market category.

Max Chen 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.