etf

Chinese stocks are up over 30% since September 2011. That’s largely because investors believe that a global recovery will raise China’s exports and improve its domestic economy. As well, the country’s inflation rate is easing. That gives it more options to boost growth, including cutting interest rates. Here are two Chinese exchange traded fund (ETF) recommendations. One invests in all publicly traded Chinese stocks available to foreign investors. The other holds small cap Chinese stocks. SPDR S&P CHINA ETF $68.38 (New York Exchange symbol GXC; buy or sell through brokers; www.spdrs.com) is an exchange traded fund that aims to track the S&P China BMI Index. This index is made up of all the publicly traded Chinese stocks that are available to foreign investors. Right now, SPDR S&P China ETF holds 184 stocks....

Vietnam’s economy is growing quickly, largely due to the country’s rising exports and low wages: its labour and production costs are as little as one-third of similar costs in China. Vietnam also has a large future labour pool: over 50% of its population of 85 million is under 25 years of age. The country’s high inflation rate is slowing, and could fall below 10% by the end of 2012. That should let the central bank cut interest rates, which could spur the economy to grow by more than 6% this year. MARKET VECTORS VIETNAM ETF $19.18 (New York symbol VNM; buy or sell through brokers; www.vaneck.com) holds shares of Vietnamese companies or foreign firms that get a significant amount of their revenue from Vietnam....

ISHARES AUSTRALIA INDEX FUND $23.75 (New York symbol EWA; buy or sell through brokers), is an ETF that holds the 73 largest Australian stocks. Its MER is 0.52%.

The fund’s top holdings include BHP Billiton, 13.7%; Commonwealth Bank of Australia, 9.2%; Westpac Banking Corp., 7.5%; Australia and New Zealand Banking Group, 6.9%; National Australia Bank, 6.1%; Woolworths, 3.6%; Rio Tinto, 3.5%; Wesfarmers, 3.5%; Newcrest Mining, 3.0%; and Woodside Petroleum, 2.8%.

Australia benefits from its stable banking and political systems. It is also rich in natural resources, and its exports are in high demand in Asian markets, including India and China.

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ISHARES MSCI BRAZIL INDEX FUND $69.18 (New York Exchange symbol EWZ; buy or sell through brokers), is an exchange traded fund that is designed to track the Brazilian stock market.

The fund’s top holdings are Petrobras preferred shares (energy), 10.2%; Cia Vale do Rio Doce (mining) preferred, 8.7%; Itau Unibanco Multiplo SA (banking), 8.1%; Petrobras common, 7.7%; and Banco Brandesco (banking) preferred, 5.7%.

The fund’s concentration in certain stocks, such as Petrobras and Cia Vale do Rio Doce, adds risk, as does its focus on the resource sector. However, both are high-quality stocks. Brazil’s economy is forecast to grow at a rate of 4.5% in 2012.

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ISHARES MSCI CHILE INVESTABLE MARKET INDEX FUND $67.90 (New York Exchange symbol ECH; buy or sell through brokers), is an ETF that aims to track the MSCI Chile Investable Market Index. This index consists of stocks that are mainly traded on the Santiago Stock Exchange.

The fund’s top holdings are Empresas Copec SA (conglomerate), 10.3%; Quimica y Minera de Chile (mining), 7.7%; Cencosud SA (retailer), 7.6%; Empresa Nacional de Electricidad (electric power), 7.4%; Enersis AS (electric power), 6.7%; Banco Santander Chile (banking), 6.6%; Empresas CMPC (pulp and paper), 5.2%; LAN Airlines SA (Chilean national airline), 4.8%; S.A.C.I. Falabella (retail), 4.7%; and CAP SA (iron mining and steel), 4.6%.

The fund’s industry breakdown is as follows: Utilities, 22.4%; Materials, 18.3%; Industrials, 18.0%; Financials, 17.4%; Consumer Staples, 13.0%; Consumer Discretionary, 6.1%; Telecommunications, 2.7%; and Information Technology, 1.3%.

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ISHARES MSCI GERMANY FUND $22.95 (New York Exchange symbol EWG; buy or sell through brokers) is an ETF that aims to track the stocks in the MSCI Germany Index.

This index aims to replicate 85% of the total market capitalization of the German stock market. The remaining 15% is unavailable for investment, partly due to limitations on foreign ownership.

The fund’s top holdings are Siemens AG (engineering conglomerate), 9.2%; BASF (chemicals), 8.9%; SAP (software), 6.9%; Bayer (diversified chemicals), 6.4%; Daimler AG (automobiles), 6.4%; Allianz (insurance), 6.2%; Deutsche Bank AG, 4.9%; E.ON (energy), 4.6%; Deutsche Telekom, 3.7%; and BMW AG (automobiles), 3.5%.

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ISHARES MSCI SOUTH KOREA INDEX FUND $59.87 (New York Exchange symbol EWY; buy or sell through brokers), is an exchange traded fund that aims to track the MSCI Korea Index.

The fund’s top holdings are Samsung Electronics, 20.8%; Hyundai Motor Co., 5.3%; Posco (steel), 4.4%; Hyundai Mobis (auto parts), 3.0%; LG Chemical, 3.0%; Shinhan Financial, 3.0%; Kia Motors, 2.7%; KB Financial, 2.4%; Hynix Semiconductor, 2.4%; and Hyundai Heavy Industries, 2.1%.

The fund’s industry breakdown is as follows: Information Technology, 30.8%; Consumer Discretionary, 16.3%; Industrials, 14.7%; Financials, 13.9%; Materials, 13.0%; Consumer Staples, 4.5%; Energy, 3.3%; Telecommunication Services, 0.9%; Utilities, 1.2%; and Health Care, 0.6%.

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ISHARES MSCI EMERGING MARKETS INDEX FUND $44.33 (New York symbol EEM; buy or sell through brokers), is an exchange traded fund that aims to track the MSCI Emerging Markets Index. Its geographic breakdown includes: China, 17.6%; Brazil, 15.6%; South Korea, 14.7%; Taiwan, 10.7%; South Africa, 7.4%; India, 6.8%; Russia, 6.5%; Mexico, 4.4%; Malaysia, 3.3%; and Indonesia, 2.6%.

iShares MSCI Emerging Markets Index Fund’s top holdings are Samsung Electronics (South Korea: electronics), 3.2%; Gazprom (Russia: gas utility), 1.8%; China Mobile, 1.7%; Petrobras Petroleo preferred (Brazil: energy), 1.6%; Vale SA (Brazil: mining), 1.3%; Taiwan Semiconductor (Taiwan: computer chips), 1.3%; China Construction Bank (China: banking), 1.3%; America Movil (Brazil: wireless), 1.3%; Itau Unibanco Holding (Brazil: banking), 1.3%; and Industrial & Commercial Bank of China (China: banking), 1.2%.

The fund’s industry breakdown is as follows: Financials, 24.0%; Energy, 14.4%; Materials, 13.4%; Information Technology, 13.3%; Consumer Staples, 7.7%; Consumer Discretionary, 7.7%; Telecommunication Services, 7.6%; Industrials, 7.0%; Utilities, 3.7%; and Health Care, 1.0%.

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Vietnam has a fast-growing economy, largely thanks to its low wages and rising exports. The country’s labour and production costs are as little as one-third of similar costs in China. Plus, over 50% of Vietnam’s population of 85 million is under 25 years of age, so it has a large future labour pool. The country is steadily integrating itself into the global economy. Vietnam hosted the 2006 Asia-Pacific Economic Cooperation (APEC) summit in Hanoi. While there, President Bush visited the Vietnam stock exchange in Ho Chi Minh City (formerly Saigon) and rang a gong to open trading. Vietnam became a member of the World Trade Organization (WTO) in 2007. This gave the country’s businesses improved access to more markets and investment capital worldwide. Vietnam is a major producer of agricultural products—it’s currently the world’s biggest exporter of cashew nuts and the second-largest exporter of coffee and rice. However, the country is quickly adding manufacturing to its export base—and it’s doing that by attracting more foreign investment....

Every Wednesday, we publish our “Investor Toolkit” series on TSI Network. Whether you’re a new or experienced investor, these weekly updates are designed to give you specific investment advice on a wide range of topics, including the best strategies to use in international stock markets. Each Investor Toolkit update gives you a fundamental piece of investing strategy, and shows you how you can put it into practice right away. Today’s tip: “There are 3 convenient ways to invest in foreign growth without getting out of your comfort zone.”...