- Latin America’s rebounding equity markets is luring some investors back to the ETFs that track the region
- iShares Latin American 40 ETF (NYSEArca: ILF) is breaking out of that slumber with a year-to-date gain of nearly 19%
- iShares MSCI Brazil Capped ETF (NYSEArca: EWZ) was in steep trouble, but that ETF has snapped back in significant fashion this year as well
The iShares Latin American 40 ETF (NYSEArca: ILF), which has been mired in a multi-year slump, is breaking out of that slumber with a year-to-date gain of nearly 19% thanks in large part to a resurgent Brazilian and Mexican stocks.
Latin America’s rebounding equity markets is luring some investors back to the exchange traded funds that track the region. As an oil exporter, Mexico’s currency has been hit by the falling crude oil prices – ETF investors should keep in mind that while Mexico has a large oil industry, none of the country-specific ETFs include exposure to the sector.
Heading to this year, the iShares MSCI Brazil Capped ETF (NYSEArca: EWZ) was in steep trouble, but that ETF has snapped back in significant fashion this year as well. Earlier this month, Brazilian shares jumped as many traders believed the country is moving past a political gridlock that could lead to changes in the government and potentially kick-start the stagnate economy, Bloomberg reported.
The Brazilian rally went into high gear after former President Luiz Inacio Lula da Silva was detained, adding to speculation that support will grow to impeach his successor, President Dilma Rousseff. Brazil and Mexico are Latin America’s two largest economies, meaning strength in those equity markets can lure investors back to the region’s ETFs.