Top 10 Asia ETFs


Our goal in this profile is to help investors wade through the many competing ETF offerings available. Using our long experience as an ETF publication, and nearly 40 years in the investment business, we can help select those ETFs that matter and may or may not be repetitive. The result is a more manageable list of issues from which to view and make selections.

There are several dozen ETFs associated with Asia single country markets, excluding China and India. The biggest, of course, are from Japan which is now the third largest global market in terms of market capitalization. We lead with that market, saving China and India for another profile. This allows us to focus on some of the more interesting and growing countries, particularly in Southeast Asia, with most countries formerly known as the Asian Tigers.

We're not ranking these ETFs favoring one over another so don't let the listing order mislead you. Although we may use some of these in ETF Digest portfolios it's not our intention to recommend one over another.

ProShares and Direxion Shares offer several inverse and leveraged issues for those interested in hedging or outright speculation.

Our technical methodology involves using, where possible, monthly charts with enough data to allow investors to stay on the right side of the 12 month moving averages. Further, when market prices move too far above or below this moving average investors can assume a correction in the other direction will eventually take place. In this regard caution is advised.


EWJ (iShares Japan ETF) follows the MSCI Japan Index which is a proprietary index covering the Japanese equity market. The fund was launched in March 1996. The expense ratio is .54%. AUM (Assets under Management) equal $8 billion and average daily trading volume is over 28M shares. As of early August 2011 the annual dividend was $.07 making the current yield .68% and YTD return -1.83%.

A competitive issue would be JPP (SPDR Russell/Nomura Prime Japan ETF) with an expense ratio of .50% and AUM of $16 million and average daily trading volume of less than 2K shares.

Also ProShares features leveraged products for hedging and speculating with similar tracking characteristics to EWJ and others.

Data as of July 2011

EWJ Top Ten Holdings & Weightings

  1. Toyota Motor Corporation (7203): 5.08%
  2. Honda Motor Company (7267):  2.75%
  3. Mitsubishi UFJ Financial Group, Inc. (8306):  2.60%
  4. Canon, Inc. (CAJFF):  2.37%
  5. Sumitomo Mitsui Financial Group, Inc. (SMFNF):  1.71%
  6. Takeda Pharmaceutical Co., Ltd. (4502):  1.64%
  7. Mitsubishi (8058):  1.54%
  8. Softbank Corporation (SFTBF):  1.46%
  9. Mizuho Financial Group, Inc. (8411):  1.42%
  10. Mitsui & Co Ltd (8031):  1.31%

 

ITF (iShares TOPIX 150 ETF) follows the S&P Tokyo Stock Price Index 150 Index which measures the performance of the 150 most liquid securities from each major market sector listed in Tokyo. The fund was launched in October 2010. The expense ratio is .50%. AUM equal $110 million and average daily trading volume is over 10K shares. As of early August 2011 the annual dividend was $.46 making the current yield 1% and YTD performance -2.90%.

Data as of July 2011

ITF Top Ten Holdings & Weightings

  1. Toyota Motor Corporation (7203):  5.94%
  2. Mitsubishi UFJ Financial Group, Inc. (8306):  3.73%
  3. Honda Motor Company (7267):  3.25%
  4. Canon, Inc. (CAJFF):  2.85%
  5. Sumitomo Mitsui Financial Group, Inc. (SMFNF):  2.35%
  6. Mizuho Financial Group, Inc. (8411):  1.94%
  7. Mitsubishi (8058):  1.92%
  8. Nippon Telegraph and Telephone Corporation (9432):  1.89%
  9. Takeda Pharmaceutical Co., Ltd. (4502):  1.82%
  10. Softbank Corporation (SFTBF):  1.76%

 

EWY (iShares South Korea ETF) follows the MSCI South Korea Index which is a proprietary index tracking stocks within the South Korean equity market. The fund was launched in May 2000. The expense ratio is .61%. AUM equal $5 billion and average daily trading volume is over 3.3M shares. As of early August 2011 the annual dividend was $.17 making the current yield .25% and YTD 7.34%.

 

Data as of July 2011

EWY Top Ten Holdings & Weightings

  1. Samsung Electronics Co., Ltd. (SSNLF):  15.41%
  2. Hyundai Motor Company Ltd. GDR (HYUO):  6.02%
  3. Posco ADR (PKX):  4.42%
  4. Hyundai Mobis:  3.99%
  5. LG Chem Ltd. GDR (LGCD):  3.84%
  6. Hyundai Heavy Industries Co Ltd:  3.27%
  7. Shinhan Financial Group Co Ltd:  3.09%
  8. Kia Motors Corp:  2.80%
  9. KB Financial Group:  2.37%
  10. Hynix Semiconductor Inc:  2.35%

EWT (iShares Taiwan ETF) follows the MSCI Taiwan Index which remains a proprietary index following securities in the general Taiwan equity market. The fund was launched in June 2000. The expense ratio is .71%. AUM equal $3.4 billion and average daily trading volume is 9.6M shares. As of early August 2011 the annual dividend was $.29 making the current yield 1.90% and YTD return -2.95%.

 

Data as of July 2011

EWT Top Ten Holdings & Weightings

  1. Taiwan Semiconductor Manufacturing (2330):  14.07%
  2. HTC Corporation (2498):  6.35%
  3. Hon Hai Precision Ind. Co., Ltd. (2317):  6.22%
  4. Formosa Plastics Corporation (1301):  3.28%
  5. Nan Ya Plastics Corporation (1303):  2.82%
  6. Chunghwa Telecom Company, Ltd. (2412):  2.59%
  7. China Steel Corporation (2002):  2.58%
  8. Formosa Chemicals & Fibre Corporation (1326):  2.42%
  9. Cathay Financial Holding Co., Ltd. (2882):  2.27%
  10. Mediatek Inc. (2454):  2.23%

 

 

EWS (iShares Singapore ETF) follows the MSCI Singapore Index which is a proprietary index covering equities in the Singapore equity market. The fund was launched in March 1996. The expense ratio is .53%. AUM equal $1.9 billion and average daily trading volume is 2.5M shares. As of early August 2011 the annual dividend was $.31 making the current yield 2.14% and YTD return 3.80%.

 

It's important to remember Singapore is the financial and economic hub for most of Southeast Asia.

Data as of July 2011

EWS Top Ten Holdings & Weightings

  1. DBS Group Holdings, Ltd. (D05):  10.25%
  2. Singapore Telecommunications Limited (Z74):  10.19%
  3. Oversea-Chinese Banking Corp Ltd. (O39):  9.32%
  4. United Overseas Bank Limited (U11):  8.97%
  5. Keppel Corporation Limited (BN4):  6.65%
  6. Genting Singapore PLC (G13):  4.82%
  7. Wilmar International Ltd (F34):  3.99%
  8. Singapore Airlines Limited (C6L):  3.27%
  9. CapitaLand Limited (C31):  3.21%
  10. Noble Group Ltd (N21):  3.17%

 

 

EWM (iShares Malaysia ETF) follows the MSCI Malaysia Index which is a proprietary index follow the equity market of Malaysia. The fund was launched in March 1996. The expense ratio is .53%. AUM equal $1.1 billion and average daily trading volume equals 2.6M shares. As of early August 2011 the annual dividend was $.24 making the current yield 1.60% and YTD return 4.80%.

 

Malaysia remains a resource rich country (rubber & palm oil) with excellent demographics indicating a consumer driven economy as well.

Data as of July 2011

EWM Top Ten Holdings & Weightings

  1. CIMB Group Holdings Berhad:  10.85%
  2. Malayan Banking Bhd Maybank:  7.87%
  3. Sime Darby Berhad (Malaysia):  6.68%
  4. Genting Berhad:  6.27%
  5. Tenaga Nasional Berhad (5347):  5.21%
  6. IOI Corp Berhad:  4.78%
  7. Petronas Chemicals:  3.89%
  8. Public Bank Berhad:  3.83%
  9. Axiata Group BHD:  3.40%
  10. Maxis Bhd:  3.27%

 

 

IDX (Van Eck Indonesia ETF) follows the Market Vectors Indonesia Index which features companies domiciled in Indonesia or earning at least 50% of their revenues from the country. The fund was launched in January 2009. The expense ratio is .60%. AUM equal $800 million and average daily trading volume is 400K shares. As of early August 2011 the annual dividend was $.82 making the current yield 2.45% and YTD return 17%.

 

Like other countries in the region, Indonesia is rich in natural resources from timber and agriculture. The country is also an OPEC member.

Data as of July 2011

IDX Top Ten Holdings & Weightings

  1. Astra International Tbk:  7.83%
  2. Bank Central Asia Tbk:  7.80%
  3. PT Bank Mandiri (Persero) TBK:  6.88%
  4. P.T. Telekomunikasi Indonesia Tbk. ADR (TLK):  6.71%
  5. Bank Rakyat Indonesia (Persero) Tbk B:  6.38%
  6. Bumi Resources Tbk:  6.11%
  7. PT Perusahaan Gas Negara (Persero) TBK:  4.81%
  8. Banpu Public Co Ltd:  4.00%
  9. United Tractors Tbk:  3.91%
  10. Adaro Energy Tbk (ADRO):  3.57%

 

THD (iShares Thailand ETF) follow the MSCI Thailand Investable Market Index which again is another proprietary index featuring coverage of the overall Thailand equity market. The fund was launched in March 2008. The expense ratio is .62%. AUM equal $680 million and average daily trading volume is 250K shares. As of early August 2011 the annual dividend was $.53 making the current yield .75% and YTD return 11.10%.

 

Data as of July 2011

THD Top Ten Holdings & Weightings

  1. PTT Public Co Ltd:  10.99%
  2. Kasikornbank Public Co Ltd:  8.12%
  3. Bangkok Bk:  7.56%
  4. PTT Exploration and Production Public Co Ltd:  7.51%
  5. Siam Commercial Bank Public Co Ltd:  6.52%
  6. Banpu Public Co Ltd:  4.09%
  7. Siam Cement:  3.88%
  8. CP All Public Co Ltd:  3.55%
  9. Charoen Pokphand Foods Public Co Ltd:  3.27%
  10. Advanced Info Service Public Company Limited (ADVANC-R):  3.11%

 

EPHE (iShares Philippines ETF) follows the MSCI Philippines Investable Market Index which again is a proprietary index covering the broad equity market in the country. The fund was launched in September 2010. The expense ratio is .65%. AUM equals $85 million and average daily trading volume is 82K shares. As of early August 2011 the annual dividend was $.02 making the current yield negligible and YTD return 4.60%.

 

The Philippines is another resource rich country with mining, agriculture and excellent demographics making the consumer sector more dynamic.

Data as of July 2011

EPHE Top Ten Holdings & Weightings

  1. SM Investments Corp:  8.46%
  2. Philippine Long Distance Telephone (PHTCF):  7.40%
  3. Aboitiz Equity Ventures Inc:  6.78%
  4. Bank of The Philippine Islands:  6.74%
  5. Ayala Land Inc:  6.73%
  6. Manila Electric Co:  5.75%
  7. Sm Prime Holdings Inc:  5.53%
  8. Metropolitan Bank & Trust Co:  4.85%
  9. Ayala Corp:  4.78%
  10. Aboitiz Power Corp:  4.71%

 

VNM (Van Eck Vietnam ETF) follows the Market Vectors Vietnam Index which includes companies either domiciled in the country or earning at least 50% of its revenues from the country. The fund was launched in August 2009. The expense ratio is .76%. AUM equal $265 million and average daily trading volume is 175K shares. As of early August 2011 the annual dividend was $.34 making the current yield 1.75% and YTD return of -25%.

 

Here it should be noted that inflation and currency devaluation have crippled equity performance. Further the economy and country are still heavily state controlled as a carryover from communist days continues. This doesn't help the free market economy despite much investor interest in the country.

 

Data as of July 2011

VNM Top Ten Holdings & Weightings

  1. Vietnam Joint Stock Commercial Bank for Industry and Trade:  9.21%
  2. BaoViet Holdings:  8.62%
  3. Joint Stock Commercial Bank For Foreign Trade of Vietnam:  6.86%
  4. Petrovietnam Fertilizer & Chemicals:  6.16%
  5. Charoen Pokphand Foods Public Co Ltd:  6.10%
  6. Oil & Natural Gas Corporation Ltd. (500312):  5.08%
  7. Premier Oil PLC (PMO):  4.71%
  8. Gamuda Berhad:  4.71%
  9. Talisman Energy, Inc. (TLM):  4.37%
  10. Vietnam Construction Import-Export Corp:  3.66%

Given their early entry to these markets, iShares continues to dominate and were the originator of single country funds in the 1990s. Having established their position early, it's quite hard for competitors to find a way to compete.

While Japan is at the top of the list, most sectors here are from the former so-called Asian Tiger countries. In these countries, economies are growing rapidly based on good internal demographics and excellent natural resources in many we have featured. Nevertheless, if their primary economy rests on exports to the developed economies of Europe and America, then they won't be immune from economic slowdowns that befall these customers.

For further information about portfolio structures using this or other ETFs see www.etfdigest.com .

You may address any feedback to: feedback@etfdigest.com   

 

(Source for holding data is from ETF Database and from various sponsors.)

This commentary comes from an independent investor or market observer as part of TheStreet guest contributor program. The views expressed are those of the author and do not necessarily represent the views of TheStreet or its management.

Dave Fry is founder and publisher of ETF Digest, Dave's Daily blog and the best-selling book author of Create Your Own ETF Hedge Fund, A DIY Strategy for Private Wealth Management, published by Wiley Finance in 2008. A detailed bio is here: Dave Fry.

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