The statue of Christ the Redeemer towers over Rio de JaneiroFelipe Dana
More exotic small-cap exchanged-traded funds (ETFs) are coming out of the gate.
Market Vectors Latin America Small-Cap Index ETF began trading Wednesday on the New York Stock Exchange Arca - the first ETF listed in North America to give exposure to smaller companies in the Latin American region.
Smaller Latin American companies operate largely or exclusively in their home markets, and are positioned to take advantage of local economic trends like growing household wealth and increased consumer spending, said Jan van Eck, principal at Van Eck Global.
The fund, which tracks the Market Vectors Latin America Small-Cap Index, has a net expense ratio of 0.63 per cent.
The ETF holds companies which have a market capitalization of at least $150-million (U.S.). The top three industry sectors are currently materials, consumer discretionary and industrials. See holdings and prospectus.
Country weightings in the ETF more closely reflect the percentage contribution each country makes to regional gross domestic product. Brazil's allocation of about 43 per cent at March 31, 2010, reflects Brazil's share of the Latin American GDP. Other Latin American indices have Brazil allocations of over 60 per cent.
Brazil is the largest country weighting followed by Mexico, Chile, Colombia, Argentina and Ecuador.