This Day On The Street
Continue to site
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

ETFs Are a Way Into Brazil

NEW YORK ( TheStreet) -- I write many articles about building narrow exposures in portfolios and also about avoiding parts of the market that seem like blatant trouble spots. Obviously, with a portfolio of individual stocks it's easy for a do-it-yourselfer to pick specific names in such a way as to avoid whatever he wants to avoid and capture whatever he wants to capture ( easy is a reference to the access, not the analysis). Obviously, not everyone wants stocks only -- exchange-traded funds are a popular tool that can allow for implementing specific inclusions and exclusions for people who take the time to look under the hood and do a little spreadsheet work.

Brazil can be used as an example. There are broad-based funds like the iShares MSCI Brazil Index Fund (EWZ) , the Global X Brazil Mid Cap ETF (BRAZ) and the Market Vectors Brazil Small Cap ETF (BRF). These funds, while each having their own sector biases, offer diversified access. Generally, I prefer narrower access and anyone agreeing with that idea has plenty of choices in terms of ETFs, individual stocks or a combination of both.

Someone interested in financial exposure in Brazil, for example, could buy the Global X Brazil Financials ETF (BRAF) and be done with it. Some portion of the financial sector allocation for the entire portfolio could go into this fund and be the total allocation to Brazil. After all, Brazil's banks generally weathered the financial crisis fundamentally far better than the U.S. and European banks and looking ahead seem to face fewer systemic threats.

Take a glance under the hood and you'll see names like Itau Unibanco (ITUB) and Banco Bradesco (BBD) -- these are names that anyone interested in Brazilian financials should be familiar with. Beyond those two names, however, there are unlikely to be too many familiar names which could be a reason to seek other ways into the country. The lack of familiarity makes the Brazil Financial ETF more difficult to analyze.

The financial sector, obviously, isn't the only way into Brazil. Anyone who has studied the country could reasonably conclude there might be three or four ways in for them along with one or two they would avoid. For anyone wanting Brazil, I think materials is one way in, as is infrastructure (think utilities and industrials) and consumer items (things that the ascending middle class in Brazil can now afford that it couldn't before).
1 of 2

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Real Money

More than 30 investing pros with skin in the game give you actionable insight and investment ideas.

Product Features:
  • Access to Jim Cramer's daily blog
  • Intraday commentary and news
  • Real-time trading forums
Only $49.95
14-Days Free
14-Days Free
AAPL $117.81 0.00%
FB $105.45 0.00%
GOOG $750.26 0.00%
TSLA $231.61 0.00%
YHOO $32.94 0.00%


Chart of I:DJI
DOW 17,798.49 -14.90 -0.08%
S&P 500 2,090.11 +1.24 0.06%
NASDAQ 5,127.5250 +11.3820 0.22%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs