Late last week we noted sizable redemption activity in a country-specific exchange traded fund, iShares MSCI Hong Kong (NYSEArca: EWH), as approximately $300 million flowed out of the fund, equivalent to about 15% of the assets outstanding in the product.
Volume swelled to over 30 million shares last Thursday, versus average daily trading volume of about 5.9 million shares as the ETF has recently met some congestion around its 200-day moving average.
Year to date, EWH has displayed promising performance, as it has rallied 10.67% versus the MSCI EAFE Index, which is up 8.30%. However, in the trailing one year period, EWH still has some ground to make up, as it has lost 12.07% versus EAFE down 12.03%.
EWH from a portfolio composition standpoint is heavily made up of mega and large cap names based in Hong Kong, with literally 99% of the portfolio invested in these segments. Additionally, the fund is very heavy financials, with 25% of the fund invested in the financial sector and 29.95% sitting in Real Estate.
For those looking for exposure to Hong Kong equities outside of the large cap space, iShares MSCI Hong Kong Small Cap (NYSEArca: EWHS) presents a unique fund offering.
The fund is basically brand new, having debuted in mid-January of this year so it is still “getting its feet wet” to some degree among ETF portfolio managers, but it has delivered strong returns thus far (up 8.45% since inception).
iShares MSCI Hong Kong