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South America ETF Industry - Growth, Trends, COVID-19 Impact, and Forecasts (2022 - 2027)

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  • 130 Pages
  • January 2022
  • Mordor Intelligence
  • ID: 5530230

For investors who are looking to invest in emerging markets largely influenced by US capital markets, South America based ETFs are an attractive option. Mainly there are 5 sovereign states that gained traction in this market. The Central Bank of Brazil stated its intent to increase support of the real currency in the wake of pandemic and many asset management firms argued that this emerging market was a prime cheap opportunity. Bank stocks and sector-related exchange-traded funds have been hard hit and have fallen behind the broader market, but this segment may be a cheap opportunity.

ETFs trade like stocks, fluctuate in market value and may trade at prices above or below their net asset value. Brokerage commissions and ETF expenses will reduce returns. Currently, the second-largest economy in South America, Argentina has made some policies recently that made them market-friendly to foreign investors.

Some notable ETFs on offer from this region are iShares MSCI Brazil Capped ETF, WisdomTree Brazilian Real Strategy ETF, iShares MSCI Brazil Small-cap ETF, VanEck Vector Brazil Small-cap ETF, and others.

Key Market Trends

A brief on Brazil based ETFs

Brazil ETFs provide exposure to different parts of Brazil's economy. Some ETFs focus on Brazil equities, the Brazilian real currency, or even subsegments such as small- or midcap equities. The largest Brazil ETF is the iShares MSCI Brazil ETF EWZ with $5.46B in assets. In the last trailing year, the best performing Brazil ETF was the FBZ at -23.19%. With 8 ETFs traded in the U.S. markets, Brazil ETFs gather total assets under management of $6.00B. The average expense ratio is 0.75%.

ETFs in Brazil are held by institutional investors in majority

Brazil began offering ETFs in 2004, and currently includes 15 listed exchange-traded products, most of them equities-based. The first-ever fixed income ETF debuted in September 2018 here. Despite its relatively small size, the market has averaged some USD 50 million in daily volume, thanks in part to products ranging from repos and stock loans to futures and options, as well as the ability for investors to use ETFs as trade collateral. The majority of ETF owners are institutional clients, accounting for some 62% of exchange-traded allocations with foreign investors representing just 7% of regional activity.

Competitive Landscape

The report includes an overview of ETF operating companies across the region. We wish to present detailed profiling of a few major companies which cover product offerings, regulations governing them, their headquarters, and financial performance. Currently, some of the major players dominating the market are listed below.

Additional Benefits:

  • The market estimate (ME) sheet in Excel format
  • 3 months of analyst support

This product will be delivered within 2 business days.

Table of Contents

1.1 Study Deliverables
1.2 Study Assumptions
1.3 Scope of the Study
4.1 Market Overview
4.2 Insights on ETFs returns, distribution channels
4.3 Technology Adoption of the Business Landscape
4.4 Global ETF Investors - Their Presence in Europe
4.5 Industry Policies And Government Regulations
4.6 Market Drivers
4.7 Market Restraints
4.8 Value Chain / Supply Chain Analysis
4.9 Porters 5 Force Analysis
4.9.1 Threat of New Entrants
4.9.2 Bargaining Power of Buyers/Consumers
4.9.3 Bargaining Power of Suppliers
4.9.4 Threat of Substitute Products
4.9.5 Intensity of Competitive Rivalry
4.10 Impact of COVID-19 on the Market
5.1 Types of ETFs
5.1.1 Fixed Income ETFs
5.1.2 Equity ETFs
5.1.3 Commodity ETFs
5.1.4 Alternatives ETFs
5.1.5 Money Market ETFs
5.1.6 Mixed Assets ETFs
5.1.7 Others
5.2 By Geography
5.2.1 Argentina ETFs
5.2.2 Brazil ETFs
5.2.3 Chile ETFs
5.2.4 Colombia ETFs
5.2.5 Peru ETFs
6.1 Market Competition Overview (Market Concentration And M&A Deals)
6.2 Company Profiles
6.2.1 Direxion
6.2.2 Deutsche Asset & Wealth Management
6.2.3 First Trust
6.2.4 Global X
6.2.5 iShares - BlackRock
6.2.6 Van Eck
6.2.7 ProShares
6.2.8 WisdomTree*