EWA (iShares MSCI Australia, Expense Ratio 0.48%, $1.8 billion in AUM) is the long running veteran in the space having debuted way back in March of 1996. The fund traded very heavy volume on Wednesday of this week, approaching a 10 million share day, when its typical ADV is only about 2.4 million shares.
For those whom may not realize it, there are actually six other Australian Equity focused funds in the space that are substantially smaller than EWA but present nonetheless. These funds are listed as follows, in AUM size order: AUSE (WisdomTree Australia Dividend, Expense Ratio 0.58%, $35 million in AUM), QAUS (SPDR MSCI Australia Quality Mix, Expense Ratio 0.30%, $15 million in AUM), KROO (IQ Australia Small Cap, Expense Ratio 0.70%, $7.1 million in AUM), DBAU (Deutsche MSCI Australia Hedged Equity, Expense Ratio 0.45%, $4.1 million in AUM), HAUD (iShares Currency Hedged MSCI Australia, Expense Ratio 0.51%, $2.5 million in AUM), and FAUS (First Trust Australia AlphaDEX, Expense Ratio 0.80%, $1.5 million in AUM).
Off of the eastern coast of Australia is of course New Zealand, where iShares also has an offering known as ENZL (iShares MSCI New Zealand Capped, Expense Ratio 0.48%, $149 million in AUM) which debuted back in 2010 and has had moderate success since.
When we look at the underlying holdings within EWA, we see a heavy allocation to Financials (43%), followed by lesser sector exposures to Basic Materials (15%), Real Estate (9%), and so on throughout the portfolio. Top individual holdings are as follows: 1) Commonwealth Bank of Australia (10.91%), 2) Westpac Banking Corp (8.41%), 3) Australia and New Zealand Banking Group Ltd (6.67%), 4) National Australia Bank Ltd (6.41%), and 5) BHP Billiton Ltd. (6.04%).
New Zealand has a much different look from a sector standpoint, as it is more evenly balanced than Australia from a market capitalization perspective. Utilities make up 18% of the portfolio, followed by a 16% weighting to Healthcare, a 14% allocation to Industrials, a 13% weighting to Telecommunications, a 10% slice allocated to Consumer Discretionary and so on throughout the portfolio. Top names here are 1) Spark New Zealand (9.84%), 2) Auckland International Airport Ltd. (9.52%), 3) Fisher & Paykel Healthcare Corporation Ltd. (8,34%), 4) Fletcher Building Ltd. (8.32%), and 5) Contact Energy Ltd. (5.27%).
The iShares MSCI Australia Index Fund ETF (NYSE:EWA) was trading at $21.64 per share on Friday morning, up $0.14 (+0.65%). Year-to-date, EWA has gained 6.97%, versus a 6.63% rise in the benchmark S&P 500 index during the same period.
Disclaimer: The content of this article is excerpted from a daily newsletter from Street One Financial. While ETF Daily News may edit the contents and add a relevant title to the piece, the author, Paul Weisbruch, does not endorse or recommend any issuer or security mentioned herein.
Paul Weisbruch is the VP of ETF/Options Sales and Trading at Street One Financial. Prior to joining the team at Street One, Paul served as the Director of RIA and Institutional ETF Sales at RevenueShares ETFs from December 2007 until November of 2009. Before RevenueShares, Paul was employed by Susquehanna International Group from 2000 until 2007 serving in roles including OTC/NYSE Institutional Block Trading, Nasdaq/OTC Market Making, ETF/Derivatives Intelligence and Strategy, Algorithmic Trading, as well as acting as the PHLX Floor Specialist in the ETFs, SPY and DIA.Paul has been actively involved in the ETF space from both a product and trading standpoint since 2000. Additionally, Paul has well forged relationships with national RIAs, institutional pension fund managers and consultants, mutual fund and hedge fund managers, and also the ETF media. Co-authoring the “S1F ETF Daily” since 2009, the daily piece has become a must for many portfolio managers in the ETF space, with segments regularly appearing in the likes of Barron’s, WSJ, and ETFTrends.com for instance.
He holds his Series 4 (Registered Options Principal), 6, 7, 55 (Equity Trader), 63, and 65 licenses. He graduated from the University of Pittsburgh (B.S. – Economics), graduating magna cum laude, and has an MBA from Villanova University.