Brazil’s higher interest rates have boosted shares of its financial services companies. That sector is the largest in EWZ at a weight of 29.3%. Up 14.5% this year, the Global X Brazil Financials ETF (NYSEArca: BRAF) is the best-performing Brazil ETF, but BRAF is not for the faint of heart as the ETF is about four times as volatile as the S&P 500 Index, reports Eric Balchunas for Bloomberg.
Friday’s pop in EWZ could be the last big day for the ETF until after the World Cup because trading volumes are expected to nosedive across football-crazed Latin America when play commences on June 12. During the 2010 World Cup, volume dipped almost 75% in Brazil on the days of the country’s matches. [LatAm ETFs Will Slow During World CUp]
Goldman Sachs recently endorsed the idea of buying Brazilian stocks on the expectations the host nation will hoist another World Cup. The bank said the winning country’s equity markets rise 3.5% on average in the month following the victory. Interestingly, Goldman owned 14.3% of EWZ at the end of the first quarter, according to Bloomberg.
iShares MSCI Brazil Capped ETF
