Being one of the superstar players of the famous BRIC team, Brazil is captivating investors mainly due to the fact that they have huge natural reserves, growing population and expanding middle class. They is something all the other BRIC economies can not say for themselves (none of the others have 3 things combined).
Historically access to Brazilian market was rather limited, and available mostly through some expensive mutual funds, but this has changed and currently there are quite a few Brazil ETFs worth looking at.
One of the key factors why Brazil ETFs have done so well is surprise surprise- energy prices. As Brazil produces more than 85% of renewable energy domestically and has huge oil reserves it stands tall above the rest. The massive infrastructure upgrades also boost the confidence in the Brazilian ETFs, even despite some concerns about drug related gang violence that has been spreading throughout Latin America in the recent years.
For investors looking for venturing into Brazil, here are 10 Brazil ETFs to consider-
iShares MSCI Brazil Index Fund (EWZ): With an expense ratio of 0.63% this ETF is the most popular Brazilian ETF. It has more than $9billion in assets and a daily trading volume of 20 million shares. Tracking the underlying index EWZ mostly covers large-cap stocks with popular brand names of Brazil like PetroBras and Vale.
First Trust Brazil AlphaDex Fund (FBZ): This is almost similar to EWZ focusing on large cap companies. It has holdings in 49 companies with major portions in similar brands like EWZ. It has an expense ratio of 0.80%.
Global X Brazil Mid Cap ETF (BRAZ): It tracks the Solactive Brazil Mid Cap Index. With an expense ratio of 0.69% it has a market capitalization of $30 million with a trading volume of 30,000 shares.
Global X Brazil Consumer ETF (BRAQ): This Brazil ETF has around $33.5 million in assets with a daily average trading volume of 40,000 shares. It has an expense ratio of 0.77% and has its holdings spread across food, retail and personal/household goods companies.
Global X Brazil Financial ETF (BRAF): BRAF tracks the Solactive Brazil Financial Index. It has an expense ratio of 0.77% with total assets of $10 million in financial companies including Banco Bradesco, Itau Unibanco and Banco Do Brasil.
Market Vectors Brazil Small Cap ETF (BRF): BRF tracks the performance of Market Vectors Brazil Small Cap Index. It has significant allocation in consumer sector. It has an expense ratio of 0.65% with total assets of $965 million.
EG Shares Brazil Infrastructure Index Fund (BRXX): This Brazil ETF has almost 30 holdings with a market capitalization of $58 million and an expense ratio of 0.85%. Stocks are involved in building and maintaining infrastructure companies.
ProShares Ultra MSCI Brazil Fund (UBR) & ProShares Ultra Short MSCI Brazil Fund (BZQ): These two leveraged ETFs tracks the MSCI Brazil Index. They seek the daily return of 200% and -200% of the index.
