Yesterday we wrote about exchange traded funds that invest in Asian equities, which presents an opportunity to focus on another continent — Africa. [ETF Chart of the Day: Asia]
ETFs that invest in Africa are new to most investors and portfolio managers, with only three products currently on the map.
The iShares MSCI South Africa (NYSEArca: EZA) is the oldest fund dedicated to the continent, having launched in 2003.
Market Vectors Africa (NYSEArca: AFK) followed in 2008, and Market Vectors Egypt (NYSEArca: EGPT) inception date was in 2010.
EZA is heavily weighted towards basic materials (25.09%) and communication services (21.53%) as well as financials (19.40%). AFK on the other hand has a 30.66% weighting in financials, 20.21% in basic materials, and 14.59% in communication services.
AFK also is heavily weighted to South Africa (26.81% weighting) followed by Nigeria (19.56%) and Egypt (16.37%). EGPT follows the Market Vectors Egypt Index and is tilted towards communication services (17.09%) and financials (11.79%).
How have these funds fared in comparison to the emerging markets or BRIC economies? Year to date, iShares Emerging Markets (NYSEArca: EEM) is down 18.19%, and EZA has lost 18.75%, AFK down 21.37%, and EGPT has taken a beating, down 42.14%.
From a trailing one year perspective, EZA is outperforming EEM, losing 10.33% versus EEM down 13.90%, while AFK is down 16.21% and EGPT down 39.15%.
Market Vectors Africa
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