Other Middle East are getting in the act as well. For the three months ending Dec. 15, the Market Vectors Gulf States Index ETF (NYSEArca: MES) and the WisdomTree Middle East Dividend Fund (NasdaqGM: GULF) fell an average of 24.7%, but MES and GULF rallied 8.8% and 7.5% from Dec. 16 through Dec. 19.
Real estate developer Emaar Properties and Dubai Islamic Bank have been among the stocks leading advances in Dubai shares, according to Bloomberg, surging 31% and 14% in just the past two trading sessions.
Emaar Properties is the largest holding in MES at nearly 6.6% of the ETF’s weight while Dubai Islamic Bank accounts for another 1.1% of the fund’s weight.
Recent weakness in Middle East equities has GULF sporting a distribution yield of 6.6% and worth noting is that GULF’s underlying index recently increased its exposure to Kuwati equities. Predictably, that is a drag when oil prices fall, but if crude is stabilizing, GULF’s better than 77% combined weight to Qatar, UAE and Kuwait should prove beneficial. [Middle East Dividend ETF Changes for the Better]
Still, investors should be aware that geopolitical tensions in addition to oil prices can hamper these ETFs. For example, it was only recently that Qatar’s hosting of the 2022 World Cup became finalized and the country is believed to be home to financiers and sponsors of terrorism.
WisdomTree Middle East Dividend Fund
