ETF Expert

The Bespoke Investment Group usually provides meaningful data and charts. Several days ago, however, they let us down by serving up arbitrary year-to-date returns; the folks at Bespoke used that data to declare that China had gone from first place to the worst BRIC performer.

Indeed, the calendar-year focus on Brazil, Russia, India and China has some investors mourning the ”paltry” 55% gains that China (PGJ) accrued in the first 3 quarters of 2009. Meanwhile, Russia (RSX) is up nearly 100%, India (IFN) at 77%, Brazil (EWZ) at 63%.

Now… mainstream media may not be expected to distinguish between an arbitrary period like 1/1-9/30, but Bespoke sure can. Wouldn’t it be more useful to look at rolling returns? Longer time periods? Why not 18 months? Perhaps we could go for 27?

Here, then, is a 27-month sneak peek:

Turns out, Russia and India have a long way to go to catch up to Brazil and China; the former nations are still wayyyyy behind in the BRIC race.

More important, one should be clear on the countries that are in the driver seat: China and Brazil. The governments are more stable; their worldwide influence is much greater than that of Russia or India.

Believe it or not… I’m not knocking Russia or India; both of these countries have unique potential all their own; that said, Brazil has the most robust consumer base of the BRIC countries as well as the widest range of natural resources. Meanwhile, China can pretty much tell the entire world what to do… and is THE primary superpower for any global recovery.

Consider the sharp rise in global equities over the last 2 days (10-5-10/6). The U.S. showed service sector growth for the first time in a year. And Australia actually raised its interest rates, sparking renewed enthusiasm about the possibility of worldwide recovery/stability. So which of the BRIC nations (Brazil, Russia, India, China) had the best showing in the dramatic jump off the 2-week slump?

To be clear, 2 days isn’t necessarily more instructive than calendar-year returns. But it certainly isn’t less instructive either! And here, we’re at least looking at how markets may act in a bounce-back. 

If you’d like to learn more about ETF investing… then tune into ”In the Money With Gary Gordon.” You can listen to the show “LIVE”, via podcast or on your iPod.

Tags | "BRIC ETF", "BRIC ETFs", "Chinese ETF", "ETF BRIC", "ETFs BRIC", "ETFs China", "Etfs chinese"