Brazil ETFs Wait for New President | ETF Trends

Brazil’s run-off elections are scheduled to take place at the end of this month. Whoever the country’s new leader will be could determine the future of this growing economy and its exchange traded funds (ETFs).

The country’s new leader will have big shoes to fill. The current president, Luiz Inacio Lula da Silva, is a former auto worker and union leader. Under Lula, Brazil’s middle class has expanded rapidly and economic growth has been around 7% a year, Annie Murphy for MarketPlace reports. The run-off will take place on Oct. 31. For more stories about Brazil, visit our Brazil category.

U.S. investors aren’t the only ones finding Brazil an appealing destination these days. Chinese Sinopec is investing $7.1 billion into Respol Brazil. This represents the largest investment by a Chinese company in South America. Matt Theal for Minyanville reports that Sinopec will get a 40% stake for its billions and values Respol at $17.8 billion. [Latin America: Why Its Not Only About Brazil.]

Rodrigo Viga Gaier and Denise Luna for Reuters reports that commodity exports and a consumer credit boom have kept Brazil’s economy strong, although expansion has cooled a bit in recent months. Most Brazil-focused ETFs are positive year-to-date, including:

  • iShares Brazil MSCI Brazil (NYSEArca: EWZ): up 5.2% year-to-date
  • Market Vectors Brazil Small-Cap ETF (NYSEArca: BRF): up 16.3% year-to-date
  • Emerging Global Shares Brazil Infrastructure (NYSEArca: BRXX): up 15.7% since Feb. 24 inception
  • SPDR S&P Emerging Latin America ETF (NYSEArca: GML): up 8.5% year-to-date
  • Global X Brazil Consumer (NYSEArca: BRAQ): up 22.2% since July 8 inception

To play Brazil’s economy with some added oomph, the ProShares Ultra MSCI Brazil (NYSEArca: UBR) is an option.

Tisha Guerrero contributed to this article.

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.