ETFdb Logo
  • ETF Database
  • Channels
    • Themes
      • Active ETF
      • Alternatives Channel
      • Artificial Intelligence
      • China Insights
      • Climate Insights
      • Core Strategies
      • Crypto
      • Disruptive Technology
      • Energy Infrastructure
      • ETF Building Blocks
      • ETF Education
      • ETF Investing
      • ETF Strategist
      • Faith-Based Investing
      • Financial Literacy
      • Fixed Income
      • Free Cash Flow
      • Innovative ETFs
      • Invest Beyond Cash
      • Leveraged & Inverse
      • Modern Alpha
      • Portfolio Strategies
      • Tax Efficient Income
    • Asset Class
      • Equity
        • U.S. Equity
        • Int'l Developed
        • Emerging Market Equities
      • Alternatives
        • Gold/Silver/Critical Materials
        • Crypytocurrency
        • Currency
        • Volatility
      • Fixed Income
        • Investment Grade Corporates
        • US Treasuries & TIPS
        • High Yield Corporates
        • Int'l Fixed Income
    • ETF Ecosystem
    • ETFs in Canada
    • Market Outlook
    • Crypto ETF Hub
  • Tools
    • ETF Screener
    • ETF Country Exposure Tool
    • ETF Database Categories
    • Indexes
    • Scenario Analysis
    • Watchlists
    • Head-To-Head ETF Comparison Tool
    • Mutual Fund To ETF Converter
    • ETF Stock Exposure Tool
    • ETF Issuer Fund Flows
  • Research
    • ETF Education
    • Equity Investing
    • Dividend ETFs
    • Leveraged ETFs
    • Inverse ETFs
    • Index Education
    • Index Insights
    • Top ETF Sectors
    • Top ETF Issuers
    • Top ETF Industries
  • Webcasts
  • Themes
    • AI ETFs
    • Blockchain ETFs
    • See all Thematic Investing ETF themes
    • ESG Investing
    • Marijuana ETFs
  • Multimedia
    • ETF 360 Video Series
    • ETF of the Week Podcast
    • Gaining Perspective Podcast
    • ETF Prime Podcast
    • Video
  • Company
    • About VettaFi
    • Get VettaFi’ed
  • PRO
    • Pro Content
    • Pro Tools
    • Advanced
    • FAQ
    • Pricing
    • Free Sign Up
    • Login
  1. Brazil ETFs Set to Continue Struggle in 2015
News
Share

Brazil ETFs Set to Continue Struggle in 2015

Jared CummansJan 19, 2015
2015-01-19

Brazil has long been one of the most alluring emerging market economies, earning itself the “B” in the popular BRIC nation group. Its economy was once bustling and offering handsome growth for investors, but that has screeched to a halt in recent years. What’s worse is that it does not appear the emerging market will get back on track anytime soon [for more ETF news and analysis subscribe to our free ETF Daily Roundup].

Brazil's Economic Woes

The chart below displays the last five annual returns for the MSCI Brazil Capped ETF (EWZ A-) and how the economy has struggled:


Content continues below advertisement

From 2010 to 2014, EWZ had an average annual return of -9.81%; from 2005 to 2009 that figure was 47.74%, a stark contrast. The poor returns come as GDP continues to disappoint, among other things. 2014 saw a trade deficit of $3.93 billion, the largest since 1998. Exports in 2014 dropped 7% while inflation continues to rise. The hefty costs of hosting the 2014 FIFA World Cup certainly did not do the country any favors. To put it simply, the Brazilian economy is facing a number of headwinds, none of which are quick fixes [see also A Deeper Look At Brazil’s Commodity Industry].

Downtown Rio de Janeiro

Looking forward to 2015, the outlook is not much better. GDP growth fell from 2.3% in 2013 to 0.15% in 2014, as the economy suffered a sharp slowdown at the end of 2014. Analysts are forecasting GDP growth of 0.5% for this year; while that may be higher than 2014, it is certainly not a number that is going to get the economy back on the right track, as it still lies on the brink of a recession. On top of that, inflation continues to rise, forcing the central bank to raise rates to attempt to keep prices at bay.

Brazil’s Prime Minister Joaquim Levy stated early this year that he will work to boost confidence and economic growth for 2015, but that has been easier said than done in previous years.

One thing investors will want to keep an eye on as the year unfolds is the price of oil and whether or not Brazil is a net importer or exporter. Depending on the month, Brazil has either been a net importer or exporter of oil over the last few years, failing to fall into any kind of consistent pattern. If Brazil is able to remain a net importer of oil and prices remain depressed, the economy could gain some traction. But if the nation becomes a net exporter with low oil prices, things could get even worse. Of course, if oil prices were to rise again, the reverse would be true for those two statements.

ETFs to Watch

There are dozens of ETFs that track the Brazilian economy in one way or another. Below are three ETFs to watch in the coming year as Brazil’s economy tries to avoid another sluggish 12 months:

  • MSCI Brazil Capped ETF (EWZ): Mentioned above, EWZ is without a doubt the largest and most popular Brazil ETF with more than $3.8 billion in assets and an average daily volume eclipsing 30 million. Tracking the equity market of the Latin American nations, EWZ will be the poster ETF to gauge just how well or poorly the economy performs in 2015.
  • Brazil Small Cap ETF (BRF A-): This fund tracks the small-cap equity sector of Brazil, meaning that it is particularly volatile. If the economy improves, BRF will tend to outperform large cap counterparts, but that process works in reverse should the economy continue to flounder.
  • BRIC Index Fund (BKF B): This fund tracks equities in all four BRIC nations. That means not only will Brazil be a major concern for this fund in 2015, but a struggling Russia will also have a big impact. This will no doubt be one of the more watched emerging market ETFs for the year.

The Bottom Line

The Brazilian economy has had a rough go over the last few years, and unless it can make some major changes, 2015 will present the same challenges and anemic growth.

Follow me on Twitter @JaredCummans.

[For more ETF analysis, make sure to sign up for our free ETF newsletter]

» Popular Pages

  • Tickers
  • Articles

Jun 20

Main Management Market Note: June 20, 2025

Jun 20

Treasury Yields Snapshot: June 20, 2025

Jun 20

S&P 500 Snapshot: Index Down for Second Straight Week

Jun 20

AVEM Hits $10 Billion Milestone Amid Rising EM Demand

Jun 20

Gold Miner ETFs Keep Rallying, But Investor Demand Lags

Jun 20

International Stocks Outperforming the U.S. – Can It Last?

Jun 20

Solana ETFs: Summer of SOL

Jun 20

Feeling Unsure About Rates? Consider Active ETFs

Jun 18

WGMI a Second Quarter Top Performer

Jun 18

T. Rowe ETFs: Active Benefits at Competitive Prices

QQQ

Invesco QQQ Trust Series I

VOO

Vanguard S&P 500 ETF

IBIT

iShares Bitcoin Trust ETF

IVV

iShares Core S&P 500 ETF

SCHD

Schwab US Dividend Equity ETF...

SPY

SPDR S&P 500 ETF Trust

GLD

SPDR Gold Shares

SHLD

Global X Defense Tech ETF

USO

United States Oil Fund LP

SMH

VanEck Semiconductor ETF


Content continues below advertisement

Loading Articles...
Our Sites
  • VettaFi
  • Advisor Perspectives
  • ETF Trends
Tools
  • ETF Screener
  • Mutual Fund to ETF Converter
  • Head-To-Head ETF Comparison
  • ETF Country Exposure Tool
  • ETF Stock Exposure Tool
  • ETF Database Pro
More Tools
  • Financial Advisor & RIA Center
Explore ETFs
  • ETF News
  • ETF Category Reports
  • Premium Articles
  • Alphabetical Listing of ETFs
  • Browse ETFs by ETF Database Category
  • Browse ETFs by Index
  • Browse ETFs by Issuer
  • Compare ETFs
Information
  • Contact Us
  • Terms of Use and Privacy Policy
  • © 2025 VettaFi LLC. All rights reserved.

Advertisement

Is Your Portfolio Positioned With Enough Global Exposure?

ETF Education Channel

How to Allocate Commodities in Portfolios

Tom LydonApr 26, 2022
2022-04-26

A long-running debate in asset allocation circles is how much of a portfolio an investor should...

Core Strategies Channel

Why ETFs Experience Limit Up/Down Protections

Karrie GordonMay 13, 2022
2022-05-13

In a digital age where information moves in milliseconds and millions of participants can transact...

}
X