Ever feel like you’re spinning your wheels trying to figure out this market? Trading in a funk lately? Consider expanding your search and look at opportunities on a macro scale.
I’ve done a little research on using ETFs to get more exposure globally. After all, the U.S. market isn’t the only pond you can fish in.
Take a look at the past two months of data on different country ETFs.
I went back to the March lows to do some comparisons. You may not be surprised to know that the #1 performer YTD has been Brazil (EWZ). It’s up +13.28%. In contrast, SPY is still down -4.11% YTD, even after this nice rally off the March lows.
Even though EWZ has put in a very nice showing since the beginning of the year, it is not without it’s share of volatility. The maximum drawdown has been over -15%. If you’re not willing to hold it through that kind of volatility, you might want to think twice. Trend traders beware getting whipsawed. However, it does set up situations where it can be swing traded.
Other top performers to check out are Taiwan (EWT), up 9.12% (-11.44% max drawdown); Mexico (EWW), up 6.18% (-11.21% max drawdown), and Canada (EWC), +4.27% with a max drawdown of -12.85%. Obviously, these carry a lot of volatility.
More recently, since the March lows, there have been some interesting developments. The number one performing country ETF is no longer Brazil. It’s Austria (EWO), with a 15.89% return since March 7. Drawdown has only been -5.89%, so it is in a trend upward.
Following Austria, in order of RS, with corresponding returns and drawdown are: Singapore (EWS) +15.55% / -6.49%; South Africa (EZA) +13.36% / -9.20%; Brazil, +13.13% / -9.22%; and Sweden (EWD), +13.03% / -5.28%.
In particular, EWO, EWS and EWD are establishing good upward trending action the past two months.
Not to be ignored, SPY has made a nice showing of +8.09% with a -3.24% maximum drawdown.
Another reason to consider these country ETFS is their non-correlation to the U.S. market. These numbers are measured over the past two months.
EWO 43.28% correlated
EWS 90.67%
EZA 36.13%
EWZ 31.95%
EWD 22.33%
Disclaimer: For informational purposes only.
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