Single Country Emerging Markets ETFs, ETNs and Closed-End Funds

Single Country Emerging Markets ETFs, ETNs and Closed-End Funds List
(click on symbol for data and articles)

Brazil ETFs
iShares MSCI Brazil Index Fund (EWZ)

Chile ETFs
iShares MSCI Chile Index Fund (ECH)

Chile Closed-End Funds
Chile Fund (CH)

China ETFs
Claymore/AlphaShares China Small Cap Index ETF (HAO)
iShares FTSE/Xinhua China 25 Index Fund (FXI)
NETS Hang Seng China Enterprises Index Fund (SNO)
PowerShares Golden Dragon Halter USX China Portfolio (PGJ)
SPDR S&P China ETF (GXC)

China Closed-End Funds
China Fund (CHN)
JF China Region Fund (JFC)
Morgan Stanley China A Share Fund (CAF)
Greater China Fund, Inc. (GCH)

Hong Kong ETFs
iShares MSCI Hong Kong Index Fund (EWH)

India ETFs and ETNs
iPath MSCI India Index ETN (INP)
PowerShares India Portfolio ETF (PIN)
WisdomTree India Earnings ETF (EPI)

India Closed-End Funds
India Fund (IFN)
Morgan Stanley India Investment Fund (IIF)

Indonesia Closed-End Funds
Indonesia Fund (IF)

Israel ETFs
iShares MSCI Israel Capped Investable Market Index Fund ETF (EIS)
NETS TA-25 Index Fund (TAV)

Israel CEFs
First Israel Fund (ISL)

Malaysia ETFs
iShares MSCI Malaysia Index Fund (EWM)

Malaysia Closed-End Funds
Malaysia Fund (MAY)

Mexico ETFs
iShares MSCI Mexico Index Fund (EWW)

Mexico Closed-End Funds
Mexico Equity and Income Fund (MXE)
Mexico Fund (MXF)

Singapore ETFs
iShares MSCI Singapore Index Fund (EWS)

Singapore Closed-End Funds
Singapore Fund (SGF)

South Africa ETFs
Shares MSCI South Africa Index Fund (EZA)

South Korea ETFs
iShares MSCI South Korea Index Fund (EWY)

South Korea Closed-End Funds
Korea Fund (KF)
Korea Equity Fund (KEF)

Thailand ETFs
iShares MSCI Thailand Investable Market Index Fund ETF (THD)

Thailand Closed-End Funds
Thai Capital Fund (TF)
Thai Fund (TTF)

Taiwan ETFs
iShares MSCI Taiwan Index Fund (EWT)

Taiwan Closed-End Funds
Taiwan Fund (TWN)
Taiwan Greater China Fund (TFC)

Turkey ETFs
iShares MSCI Turkey Investable Market Index Fund ETF (TUR)

Turkey Closed-End Funds
Turkish Investment Fund (TKF)

What Are They?

• Single country funds -- ETFs (exchange-traded funds), ETNs (exchange-traded notes) and CEFs (closed-end funds) -- provide investors with exposure to foreign stocks on a country by country basis, in contrast to broad and regional funds which cover multiple countries' stocks in a single ETF.
• Single country ETFs and CEFs usually provide exposure to foreign stocks that don't trade on US exchanges, though sometimes they are limited to stocks that trade in the US as ADRs (American Depository Receipts).
• ETFs and ETNs are typically index funds which trade close to or at their underlying asset value. In contrast, closed-end funds tend to be actively managed, and due to their structure can trade at significant premia or discounts to their net asset values.

Why & How To Use Them

• If you're a long term investor looking to build a diversified portfolio that includes foreign stocks, you'll need to decide whether to use a few broad foreign stock ETFs or a collection of single country ETFs and closed-end funds. Broader funds tend to be cheaper and easier to manage. Since ETFs are usually market cap weighted, a broad or regional foreign stock ETF will provide exposure to countries proportionate to the size of their stock markets. In contrast, single country funds allow you to overweight countries that you believe will perform better.
• If you decide on single country funds, you'll need to chose between using an ETF or a CEF for any given country. ETFs (exchange-traded funds) appeal to investors looking for maximum diversification, low cost and an indexing approach. CEFs (closed-end funds) offer opportunities to investors looking for a more active approach to management. We've grouped the ETFs and CEFs together by country below, so you can see the choice of ETFs and CEFs for each country.
• Closed-end funds may be attractive when they trade at discounts to net asset value, despite their higher expense ratios and more limited holdings. For more on this important issue, see Further Reading below.

What to Look Out For

• Compared to broad or regional foreign stock ETFs, single country ETFs tend to have higher expense ratios, have been criticised for wide tracking error (divergence from their underlying indexes), and may suffer from wider bid-ask spreads.
• Closed-end funds tend to have higher expense ratios than ETFs, and may be more expensive to purchase and sell as their lower trading volume may result in wider bid-ask spreads.
• Closed-end funds are a specialty. A CEF may look attractive if it trades at a discount to net asset value, but discounts may persist for long periods of time, and higher expenses and poor active management might lead to underperformance. See Further Reading below for more on investing in CEFs.

Further Reading

• Articles on specific ETFs in this list: Huge Upside In Singapore ETF Over Next 3-5 Years - Barron's (Eli Hoffmann), South Africa ETF: Exciting But Risky (Gary Gordon), Investing in Taiwan: Choosing The Taiwan Fund Over iShares' ETF (David Urban), A Look Under the Hood of iShares South Korea (Steven Towns).
• Analysis of the Indian ETFs, ETNs and CEFs: WisdomTree's India Earnings ETF (Geoffrey Lordi), Take Note of the Energy Weighting in This New India ETF (Roger Nusbaum), PowerShares Joins the India ETF Party (Heather Bell).
• For more information on the choice between broad foreign stock funds and single country funds, see Gary Gordon's International ETFs: Be Aware of Extreme Single Stock Exposure and Broad and Regional Emerging Market ETFs, and Richard Kang's Is Emerging Market ETF Slicing and Dicing Necessary?.
• The case for closed-end funds is discussed in ETF Investing Guide: Why Use Closed-End Funds?. Roger Nusbaum provides an alternative view in Why Closed-End Funds Don't Work for Most Investors. Daily commentary on closed-end funds is available in Seeking Alpha's closed-end funds section.
• WisdomTree offers dividend-weighted ETFs for Japan and various regions. For more on foreign dividend-weighted ETFs, see International Dividend ETFs.
• The problem of tracking error of foreign stock ETFs is discussed in Matt Hougan's Tracking Error In Exchange Traded Funds, Herb Morgan's ETF Tracking Error: 'Need' vs. 'Demand' Funds, and Larry MacDonald's Index Tracking Errors in ETFs.

This page is part of The Seeking Alpha ETF Selector which sorts ETFs by type, highlights how to use them and what to look out for, and provides links to articles that discuss key issues for investors.

Comments

[Frank Li]

Surprised there's no Turkey index ETF. Turkey is a large and growing economy, and is about to enter the EU.

[Ralph F]

No it isn't -- the EU won't let them in.

[TW]

aRE THERE ANY EMERGING MARKET BOND ETFS THAT ARE LOCAL CURRENCY DENOMINATED THEREBY GIVING US A TAILWIND WITH DOLLAR DEPRECIATION?

[DavidJackson]

We just added the new India earnings-weighted ETN from WisdomTree (EPI) in the list.

[DavidJackson]

TW -- there aren't any emerging market currency ETFs or ETNs yet, but apparently they're in the works. You can view the currently available currency ETFs and ETNs here:

etf.seekingalpha.com/a...

[DavidJackson]

Update: we just added the PowerShares India Portfolio ETF (PIN), and included links to articles evaluating and comparing the India ETFs and ETNs.

[DavidJackson]

Update: We just added three new Barclay's ETFs to this list: for Israel, Turkey and Thailand.

[DavidJackson]

Update: We just added in the new China ETF from Northern Trust.

[DavidJackson]

Update: We just added the new Northern Trust Israel ETF to the list, the NETS TA-25 Index Fund (TAV). Heather Bell writes about this ETF:

"TAV, however, is not the first of its kind. The iShares complex already offers the competing iShares MSCI Israel Capped Investable Market Index Fund (NYSE Arca: EIS), which charges 0.68%. In a departure for the NETS family, TAV is actually more expensive than its corresponding iShares ETF: It charges 0.70%. EIS was only launched in late March, so it hasn't had time to gain much of a foothold - Northern Trust may be looking to compete with it more on the basis of the underlying index than on price."

Her full article is here:
seekingalpha.com/artic...

[Qniform]

They left out the Swiss Helvetica Fund (SWZ, I think) the only single country CEF for Switzerland I know of.