Franklin FTSE Brazil ETF

FLBR tracks a market cap-weighted index of Brazilian large- and mid-cap stocks.

I am downgrading my recommendation to hold the Franklin FTSE Brazil ETF due to deteriorating factors like the dollar and electricity prices in Brazil. Despite Brazilian assets being historically cheap, a new cycle of high interest rates will delay multiple expansions, making the risk/return unattractive. Potential risks include the Fed possibly cutting US interest rates, which could give Brazil's Central Bank room to maintain or cut rates later.

FLBR: Skeptical View As Inflation Nears Target

Lula's attacks on Central Bank independence led to Brazil's poor performance in emerging markets, but similar speeches in 2023 resulted in a rally.

FLBR: Exaggerated Pessimism Opens Up An Opportunity

FLBR has delivered negative returns of 17% and underperformed emerging markets and global stocks in 2024. Despite the adverse performance so far, we are now prepared to turn more optimistic on FLBR as some key macro-economic variables are in a better place. Despite an unappealing payout in June, FLBR's yield of over 7.3% still looks very compelling.

FLBR- Taking A Positive Stance Now

FLBR offers a strong value profile with a high dividend yield (9.33% in 2023), trading at 1.5x book value and 8x earnings. However, there are concerns about Brazilian President Lula's interventionist policies towards key sectors like energy and materials. While Brazil's export-oriented economy could mitigate domestic macroeconomic risks, the volatility of commodities and potential boom-and-bust cycles, along with political risks, temper the attractiveness of FLBR.

FLBR: Exceptional Value Threatened By Lula's Long Arm

CSOP FTSE China A50 ETF

Xtrackers Harvest CSI 300 China A-Shares ETF

Xtrackers Harvest CSI 500 China A-Shares Small Cap ETF

Xtrackers MSCI China A Inclusion Equity ETF

Avantis Emerging Markets Equity ETF

Avantis Emerging Markets Value ETF

VanEck Vectors Brazil Small-Cap ETF

Direxion Daily MSCI Brazil Bull 2X Shares

ProShares UltraShort MSCI Brazil Capped

Morgan Stanley China A Share Fund Inc

Direxion Daily CSI 300 China A Share Bull 2X Shares

VanEck Vectors ChinaAMC SME-ChiNext ETF

iShares MSCI China A ETF

WisdomTree China ex-State-Owned Enterprises Fund

Xtrackers MSCI Emerging Markets Hedged Equity ETF

Dimensional Emerging Markets Value ETF

Franklin Emerging Market Core

Direxion Daily Emerging Markets Bull 3X Shares

Direxion Daily Emerging Markets Bear 3X Shares

iShares MSCI Emerging Markets ETF

ProShares Ultra MSCI Emerging Markets

ProShares UltraShort MSCI Emerging Markets

Xtrackers Emerging Markets Carbon Reduction and Climate Improvers ETF

Franklin Templeton Emerging Markets Fund

Global X Next Emerging & Frontier ETF

iShares MSCI Emerging Markets ex China ETF

WisdomTree India Earnings Fund

iShares MSCI EM ESG Optimized ETF

ProShares Short MSCI Emerging Markets

iShares MSCI Brazil ETF

iShares MSCI Brazil Small-Cap ETF

First Trust Brazil AlphaDEX Fund

First Trust Emerging Markets AlphaDEX Fund

Franklin FTSE India ETF

iShares MSCI Frontier 100 ETF

Freedom 100 Emerging Markets ETF

iShares Currency Hedged MSCI Emerging Markets ETF

iShares Core MSCI Emerging Markets ETF

Morgan Stanley India Investment Fund Inc

Columbia India Consumer ETF

iShares MSCI India ETF

Nifty India Financials ETF

Direxion Daily MSCI India Bull 2X Shares

iShares India 50 ETF

JPMorgan Emerging Markets Equity Core ETF

KraneShares MSCI All China Index ETF

KraneShares Bosera MSCI China A Share ETF

KraneShares SSE STAR Market 50 Index ETF

iShares ESG MSCI EM Leaders ETF

PIMCO RAFI Dynamic Multi-Factor Emerging Markets Equity ETF

First Trust India NIFTY 50 Equal Weight ETF

Invesco India ETF

First Trust RiverFront Dynamic Emerging Markets ETF

Hartford Multifactor Emerging Markets ETF

Schwab Emerging Markets Equity ETF

iShares MSCI India Small Cap ETF

SPDR Portfolio Emerging Markets ETF

Vanguard FTSE Emerging Markets ETF

WisdomTree Emerging Markets ex-State-Owned Enterprises Fund

Emerging markets continued to expand at a solid pace midway into the first quarter of 2024, supported by broad-based expansion across both manufacturing and service sectors.

Emerging Markets Growth Remains Solid Amid Intensifying Inflationary Pressures

VanEck China Bond ETF

Global X China Biotech Innovation ETF

Global X MSCI China Communication Services ETF

Global X China Energy ETF

Global X MSCI China Health Care ETF

Global X China Industrials

Global X MSCI China Information Technology ETF

Global X China Materials ETF

Global X China Consumer ETF

Global X MSCI China Real Estate ETF

Global X MSCI China Consumer Staples ETF

Global X MSCI China Utilities ETF

Global X China Financials ETF

Loncar China Biopharma ETF

Xtrackers MSCI All China Equity ETF

Invesco China Technology ETF

iShares MSCI China Small-Cap ETF

iShares MSCI Hong Kong ETF

iShares MSCI Taiwan ETF

iShares MSCI Mexico ETF

First Trust China AlphaDEX Fund

Franklin FTSE China ETF

Franklin FTSE Hong Kong ETF

Franklin FTSE Latin America ETF

Franklin FTSE Mexico ETF

First Trust Latin America AlphaDEX Fund

Franklin FTSE Taiwan ETF

iShares China Large-Cap ETF

ProShares UltraShort FTSE China 50

SPDR S&P China ETF

iShares Latin America 40 ETF

KraneShares Bloomberg China Bond Inclusion Index ETF

KraneShares CICC China 5G and Semiconductor Index ETF

Kraneshares MSCI China Environment Index ETF

KraneShares Hang Seng Tech Index ETF

KraneShares MSCI All China Health Care Index ETF

KraneShares CSI China Internet ETF

iShares MSCI China ETF

Direxion Daily MSCI Mexico Bull 3X Shares

Invesco Golden Dragon China ETF

Rayliant Quantamental China Equity ETF

Franklin Templeton Dragon Fund

ProShares Ultra FTSE China 50

Direxion Daily FTSE China Bear 3X Shares

Direxion Daily FTSE China Bull 3X Shares

ProShares Short FTSE China 50

China and Hong Kong markets had a humbling 2023 with equities down more than 10%. Beijing has also begun stepping up tourism and travel promotions, granting visa-free entry to 11 countries, with Singapore and Thailand the latest to be included.

Enter The Dragon: Parsing Lunar New Year Opportunities Among Emerging Markets

The Franklin FTSE Brazil ETF offers low-cost access to mid-and-large-cap Brazilian stocks. We touch upon a few differing characteristics of FLBR in relation to its largest peer- EWZ. Brazilian macros may not be as resilient as they've been through FY23, and compared to the other BRICS, the drop-off in GDP in 2024 will be the most pronounced.

FLBR: Wait On The Sidelines

Emerging market stocks often get overlooked, but adding them to your portfolio allows for diversification and potentially big returns. Just tread lightly.

How to Find the Best Emerging Market Stocks

Franklin FTSE Brazil closely mirrors the performance of the FTSE Brazil Capped Index, making it an attractive option for investors seeking RIC concentration requirements. FLBR is concentrated in the finance, energy minerals, and non-energy minerals sectors, with notable holdings in major Brazilian banks and companies like Vale and Petrobras. Macroeconomic indicators, fiscal concerns, tax revenue trends, and commodity prices shape FLBR's future outlook, prompting cautious optimism amid risks.

FLBR: Mixed Indicators, Cheap Brazilian Equities, Opportunities Ahead

The Franklin FTSE Brazil ETF invests across the most important Brazilian companies. We highlight key advantages of FLBR compared to the larger iShares MSCI Brazil ETF including a lower expense ratio and historical outperformance. Improving macro data out of Brazil supports a positive outlook for Brazil stocks.

FLBR: Low-Cost Exposure To Brazil Stocks

Brazil's key economic indicators are now moving in the right direction. A sooner-than-expected policy pivot may be on the horizon. The heavily discounted Franklin FTSE Brazil ETF is poised to benefit.

FLBR: Time To Look At Brazil Again Ahead Of A Likely Monetary Policy Pivot

Global X MSCI Argentina ETF

iShares MSCI Poland ETF

Global X MSCI Greece ETF

Global X MSCI Nigeria ETF

Invesco DB US Dollar Index Bullish Fund

As the second-quarter draws to a close, Wall Street and global markets, must be interested in knowing which country ETFs won in the second quarter.

5 Country ETFs Beating the S&P 500 in Q2

The Brazilian economy avoided entering a technical recession in the opening quarter of 2023, with a growth rate of 1.9% largely beating market expectations. PMI data up to May so far point to sustained growth for the second quarter, albeit with notable sector divergence.

Uneven Impact Of High Interest Rates: Brazil Manufacturing Struggles While Service Thrives

Annual inflation in Brazil reached 4.7% in March, the lowest since January 2021, as the impact of external shocks continues to vanish. Brazil's inflationary environment remains under pressure.

Brazil's Inflation Falls And There May Be Room For Easing Monetary Policy This Year

FLBR: Fiscal Issues Remain The Key Overhang On Brazilian Equities.

FLBR: Fiscal Issues Remain The Key Overhang On Brazilian Equities

In the fog of domestic political and fiscal uncertainty, investors may still find Brazil equities poised to benefit from structural growth trends within their industries. We believe the tide is turning for Brazil equities, and high-quality companies could benefit the most.

Brazil Beckons With Low Valuations And Growth Potential

Ambev

iShares MSCI Argentina & Global Exposure ETF

iShares MSCI Peru ETF

Fomento Economico Mexicano SAB de CV

Grupo Financiero Banorte SAB de CV

Itau Unibanco Holding S.A.

Petroleo Brasileiro

Southern Copper

Vale S.A.

The MSCI Latin America Index has performed better than the MSCI Emerging Market Index cumulatively over the past 5 and 7 years as well as over longer time periods, buoyed by its natural resource companies. The region is well placed to take advantage of the opportunities created by the renewable energy revolution with 54% of global lithium reserves concentrated there.

Investment Opportunities In Latin America

The Franklin FTSE Brazil ETF offers US investors a low-cost vehicle to access Brazilian equities. Given the market cap-weighted index it tracks is heavy on mining and O&G, as well as SOEs, the ETF is highly exposed to policy risks from the new administration.

Franklin FTSE Brazil ETF: A Bumpy Ride Ahead

Water scarcity in Latin America is likely to intensify supply chain and operational disruptions, regulatory risks, and economic losses for businesses during the next five years. In Brazil, hydropower accounts for 65% of the electricity matrix.

Water Scarcity In Latin America: Operational Challenges

FLBR's volatility has been high of late but could come down now given the election results. Lula's spending ambitions could restimulate inflationary pressures but for now, things appear in good shape.

Franklin FTSE Brazil ETF: Post-Election Bull-Case Looks Solid

SPDR Bloomberg Emerging Markets Local Bond ETF

iShares MSCI Chile ETF

WisdomTree Emerging Markets Local Debt Fund

VanEck Vct Emrg Shs

SPDR Bloomberg Emerging Markets USD Bond ETF

iShares Emerging Markets High Yield Bond ETF

VanEck J.P Morgan EM Local Currency Bond ETF

SPDR DoubleLine Emerging Markets Fixed Income ETF

iShares MSCI South Africa ETF

First Trust Emerging Markets Local Currency Bond ETF

Franklin FTSE South Africa ETF

JPMorgan USD Emerging Markets Sovereign Bond ETF

iShares J.P. Morgan EM Local Currency Bond ETF

Invesco Emerging Markets Sovereign Debt ETF

Vanguard Emerging Markets Government Bond ETF

Central banks across emerging markets have reacted to elevated inflation by significantly tightening monetary policy, in some cases, well ahead of the U.S. Federal Reserve and the European Central Bank. After largely synchronized rate-hiking cycles across EM, monetary policies could once again begin to diverge among individual countries.

Peak Inflation May Hint At Peak Rates In Emerging Markets

Stocks, currency rally amid a return of political stability.

Brazil ETFs Post Gains After Lula Victory

Brazil held its run-off presidential election this past weekend, with President Jair Bolsonaro losing a close and hotly contested election to former President Luiz Inacio Lula da Silva, known as Lula.

Election Bump for Brazil ETFs? Watch FLBR

Lula claims third term as president, narrowly defeating incumbent Jair Bolsonaro. Political divides remain deep, but the government appears balanced by a newly elected pro-market Congress.

Lula Returns To Helm Of World's 12th Largest Economy: 'Brazil Is Back'

Brazil's newly elected president, Luiz Inácio Lula da Silva will have to walk a narrow path of expenditures given the budget constraints.

Brazil: Setting The Stage For A Brighter Future?

News for Franklin FTSE Brazil ETF ETF (FLBR)