Oil, emerging markets and Mexico lead ETF returns in 2021

January 9, 2021 | 5:00 am

Oil, emerging market equities and Mexican equities lead the returns of Exchange Traded Funds (ETFs), more traded by investors.

Of the 18 main Exchange Traded Funds (ETFs) of stocks, commodities and bonds, oil rises 7.36% at the start of 2021, followed by emerging market equities, with 5.90%, and Mexican equities, with an increase of 5.75%.

As oil climbs on optimism for a global economic recovery, emerging markets are attractive to asset managers such as Thornburg Investment Income Builder Fund, which manages $ 10.5 billion.

Emerging markets, along with China and the United States, are also among BlackRock’s favorite markets, the world’s leading asset manager.

Exchange Traded Funds (ETFs) are instruments that have the characteristics of an investment fund and a share. Of investment funds they resume diversification and of shares, liquidity, thanks to the fact that they are listed on stock exchanges.

ETF selection

On the equity side, the most liquid ETFs that were considered for this exercise were those that replicate the S&P 500 index (SPY), the Dow Jones Industrial Average (DIA), the Nasdaq 100 (QQQ), the S & P / BMV IPC (NAFTRAC), stocks of companies located in emerging markets (EEM) and developed (EFA) and the VT ETF, composed of a sample of just over 8,000 companies around the world.

Commodity ETFs were gold (GLD), silver (SLV), palladium (PALL), copper (CPER), US oil (USO) and the GSG, which has a sample of 14 different raw materials.

In fixed income, ETFs that replicate US corporate bonds with investment grade (LQD), without investment grade or high yield (HYG), short-term Treasury bonds (SHV), bonds of emerging countries ( EMB) and BNDX, made up of just over 5,800 investment grade sovereign bonds denominated in different currencies to the dollar.

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