Trade wars, especially between the United States and China, have not only wreaked havoc on economic superpowers, but emerging markets have also received a brunt of the punishment with ETFs like Vanguard FTSE Emerging Markets ETF (NYSEArca: VWO) down 7.32% year-to-date and iShares MSCI Emerging Markets ETF (NYSEArca: EEM) down 7.44% YTD.
Even country-specific ETFs on the periphery are suffering as a result of trade wars–iShares MSCI Mexico Capped ETF (NYSEArca: EWW) down 3.13% YTD, iShares MSCI Brazil Capped ETF (NYSEArca: EWZ) down 19.48% YTD and iShares MSCI Philippines ETF (NYSEArca: EPHE) down 22.03% YTD.
“We’ve seen areas of the world that have really gotten beaten up,” said ETF Trends President Tom Lydon. “Areas like Brazil, Mexico, Malaysia, the Philippines–all because of the trade wars.”
The amount of red in the YTD performance numbers might scare off investors with an untrained eye, but to others, this presents a perfect buying opportunity, particularly when fundamentally analyzing each country-specific ETF.
“While these areas of the world have gotten beaten up and we’ve got some political restructuring going on in some of these countries, take advantage of some of the sell-offs that we’ve seen,” said Lydon. “Some of these areas of the world are still off 70, 80 percent.”
For broad based technology exposure, Lydon said look no further than the Invesco QQQ (NasdaqGM: QQQ).