VanEck rolls out four UCITS ETFs on the Mexican Stock Exchange

Nov 30th, 2017 | By | Category: Alternatives / Multi-Asset

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VanEck has introduced four VanEck Vectors UCITS ETFs on the Bolsa Mexicana de Valores, offering a mix of exposure: emerging market bonds, global gold miners, global small-cap gold miners, and US companies with wide economic moats’.

VanEck rolls out four UCITS ETFs on the Mexican Stock Exchange

The funds have been listed on the Bolsa Mexicana de Valores.

All four funds are denominated in US dollars and trade in Mexican Pesos.

“Since launching our first UCITS ETF in 2015, we have seen increasing investor interest in Mexico”, said Eduardo Escario, regional director at VanEck.

“The listing of our UCITS ETFs in Mexico is an important milestone for our ETF business worldwide, and we are pleased to offer Mexican investors a choice between UCITS and US-domiciled ETFs.”

Emerging market bonds

The VanEck Vectors JP Morgan EM Local Currency Bond UCITS ETF (EMLC LN) offers exposure to bonds issued in local currencies by emerging market governments through tracking the JP Morgan GBI-EMG Core Index. The index is composed of bonds issued in local currencies by 17 emerging markets governments: Argentina, Brazil, Chile, Colombia, Czech, Hungary, Indonesia, Malaysia, Mexico, Peru, Philippines, Poland, Romania, Russia, Thailand, Turkey, South Africa and Uruguay. It is market-cap weighted, with individual country exposure capped at 10% and a minimum exposure of 3% to provide more country diversification.

According to VanEck, emerging markets bonds tend to provide higher yields than developed markets while investing in bonds denominated in local currencies offers the potential for currency appreciation. The firm adds that local currency emerging markets bonds tend to have a lower correlation to the US dollar and help to diversify a portfolio.

EMLC has assets under management (AUM) of $50 million and a total expense ratio (TER) of 0.44%.

Gold miners

The VanEck Vectors Gold Miners UCITS ETF (GDX LN) and the VanEck Vectors Junior Gold Miners UCITS ETF (GDXJ LN) provide access to the global gold mining sector. GDX covers a comprehensive portfolio of large-, mid-, and small-capitalisation global gold mining companies and currently has $110m in AUM and a TER of 0.53%. GDXJ invests in micro-, small-, and medium-capitalisation mining companies, called “juniors” because they are in an exploratory or early mining phase. The fund has $72m in AUM and a TER of 0.55%.

US economic moats

The VanEck Vectors Morningstar US Wide Moat UCITS ETF (MOAT LN) tracks the Morningstar Wide Moat Focus Index which consists of the most attractively priced companies (lowest ratios of stock price to fair value) with sustainable competitive advantages as determined by Morningstar. The term ‘economic moat’ was coined by Warren Buffett to classify firms which have established competitive advantages (through possible avenues such as brand loyalty, high switching costs, network effects, regulatory protection or economies of scale). The ETF has AUM of $25m and a TER of 0.49%.

The underlying Morningstar Wide Moat Focus Index has outperformed the broader US equity market since its inception. Since 2007, the S&P 500 has generated a total return of 132%. In the same period, the Morningstar Wide Moat Focus Index achieved a return of 236%.

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