When you look at the year’s performance of exchange traded funds (ETFs) that track Asian economies – Indonesia, China, India – it becomes clear that they’re leading the charge on global growth. There’s another way to get exposure to this growth via ETFs, and it’s not even an Asian country.
As China, India and other emerging Asian countries build their infrastructure, boosting demand for commodities and all the stuff of which economies are made, Australia may be best positioned to reap the rewards, reports Mike Hogan for Barron’s. Australia is loaded down with natural resources: coal, iron, potash, oil and more. [Commodity Currencies Get An ETF.]
- iShares MSCI Australia (NYSEArca: EWA): up 18.1% in the last three months
- IQ Australia Small Cap (NYSEArca: KROO): up 29.7% in the last three months
- WisdomTree Pacific ex-Japan High-Yielding Equity (NYSEArca: DNH): Australia is 90.7% of the ETF; up 15.3% in the last three months
Australia is fiscally prudent, making it a more conservative way to get exposure to Asia’s growth. The country is forecast to grow 3.75% this year, its 20th consecutive year of economic expansion. It also boasts low unemployment and a positive trade balance.
According to Associated Press, China needs a stronger currency to boost domestic demand and reduce its reliance on exports, which is a rebalancing needed across Asia to ensure the region’s long-term growth prospects, reports the IMF. This will help enhance the role of domestic consumption and help to further drive the economy. [4 ETFs For Growing Digital Demand in Asia.]
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.