How to Play Portugal
06/02/08 - 11:19 AM EDT
Roger Nusbaum
Northern Trust's(NTRS Quote - Cramer on NTRS - Stock Picks) most recent listing of a single country ETF under the brand name NETS covers Portugal's PSI 20 Index and trades with ticker LIS(LIS Quote - Cramer on LIS - Stock Picks).
This fund will never be a good fund or a bad fund -- it is simply exposure to the Portuguese market, just as the S&P 500 or Russell 1000 could be thought of as exposure to the U.S. market. A given moment in time will either be a good time to buy the fund, i.e. buy Portugal, or it will not. The NETS focus on the benchmark indexes in these countries. For example, the France fund tracks the CAC 40, as opposed to iShares, which tracks the MSCI France Index. Obviously, more people know and track something like the CAC 40 than an MSCI index. There are a total of 14 NETS country funds listed so far, with more on the way, but Portugal is one of the smaller countries available. Most of the single-country NETS funds charge an expense fee of 0.47%, as does LIS. LIS is heaviest in financials stocks at 26.55%, followed by utilities at 17.84%, industrials 17.27% and telecom 15.39%. There are only 20 stocks in the index, so the fund might be more concentrated in sectors than you might be used to. The 13th largest holding is Sonae SGPS, and it has a larger weight in LIS at 4.12% than Exxon Mobil(XOM Quote - Cramer on XOM - Stock Picks) has in the S&P 500. LIS' largest holding is EDP-Energias de Portugal (EDPFY Quote - Cramer on EDPFY - Stock Picks), the big electric company of Portugal, at 15.16% of the fund. Anyone studying LIS probably needs to learn a little about Energias.
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