ETF selected: Xtrackers MSCI Mexico UCITS ETF 1C
What's in this ETF?
The selected ETF covers around 85% of the Mexican stock market. It is invested in 26 large- and mid-cap companies. These include financial companies Grupo Financiero Banorte (14.1%), Fomento Económico Mexicano (13%) and Grupo Financiero Inbursa (2.9%), telecommunications company America Movil (9%), mining group Grupo México (9.4%), Walmart de México (9.4%), construction materials giant Cemex (6.9%), airport operatorsroport operators Grupo Aeroportuario Del Pacifico (3.2%) and Grupo Aeroportuario Del Surest (2.9%), and food company Grupo Bimbo (3.2%).
Exports from China and Mexico to the United States.
By purchasing this ETF, investors are mainly exposed to the basic necessities sector (36.1%), materials (18.8%), financials (18.6%) and manufacturing (12.4%).
The United States' main trading partners (source: Bloomberg)
What are its advantages?
- The ETF provides well-diversified exposure to the major companies in the Mexican economy.
- Mexico should continue to take advantage of its good relations with the United States to increase exports to the world's leading economy. The ETF has gained 166% since April 2020.
- The amount outstanding is not gigantic, but it is sufficient to ensure good liquidity ($270 million).
More negative points
- The ETF is invested in Peso. As a result, currency risk should not be overlooked.
- Management fees are fairly high (0.65%).
The ETF's identity card :
Number of positions: 26
ISIN code: LU04766289466
Ticker: D5BI
Fees: 0.65
You can find this ETF on MarketScreener.