Global X rolls out active Brazil & India equity ETFs

Aug 22nd, 2023 | By | Category: Equities

Global X has introduced two new single-country equity ETFs in the US providing actively managed exposure to stocks listed in Brazil and India.

Malcolm Dorson, Head of Emerging Markets Strategy at Global X.

Malcolm Dorson, Head of Emerging Markets Strategy at Global X

The Global X Brazil Active ETF (BRAZ US) and Global X India Active ETF (NDIA US) have been listed on NYSE Arca with expense ratios of 0.75% each.

The funds offer investors a research-driven approach to Brazil and India, two of the largest and most dynamic emerging markets globally, while maintaining the fee structure, liquidity, and transparency inherent in the ETF structure.

Commenting on the investment case for Brazilian stocks, Global X notes that the key South American economy boasts a skilled workforce, abundant natural resources, and a quickly growing consumer market. Combined with a recent pivot from its central bank to monetary easing, as well as a new fiscal reform package from the government, Brazil may offer a compelling cyclical opportunity for investors.

On the other side of the globe, meanwhile, growth in India continues to benefit from favourable structural reforms, strong government spending, and low labour costs. With attractive demographics, a strong education system, and a democratic government, Global X believes India represents a significant structural opportunity for investors.

Given the large but nuanced opportunity sets in these two countries, Global X highlights that an active management approach can offer better diversification than passive strategies which tend to lean towards larger state-owned enterprises rather than smaller, innovative companies potentially driving future transformative growth.

Both BRAZ and NDIA screen for companies with sustainable long-term business models, durable competitive advantages, businesses that are poised to benefit from long-term socio-economic trends, and quality management teams, focusing on domestic-driven growth over a 4-5 year investing horizon.

The ETFs also utilize the risk management framework provided by Global X’s parent company, Mirae Asset Investments, to guide them on individual position size limits, sector weight limits relative to broad-based benchmarks, and a target number of holdings.

Malcolm Dorson, Head of Emerging Markets Strategy at Global X, said: “The opportunity for investors in both Brazil and India is significant, as both of these major economies evolve and enter cycles of domestic consumer-driven growth. With BRAZ and NDIA, we are offering investors an experienced emerging markets management team that can look beyond just these country’s largest players and offer exposure to a broad range of dynamic Brazilian and Indian companies.”

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