=EPOL : Tracks Poland, one of Europe's hottest markets

The broad Polish WIG index is up about 17% so far this year, easily outperforming the main indexes in France, Germany and Britain. Little wonder, iShares MSCI Poland Capped ETF (EPOL) joined the IBD ETF Leaders screen this month. It is trading at the highest levels in nearly two years.

Shares of the ETF broke out of a consolidation in January and sped up 18% from Jan. 11 to March 21. The ETF cooled its advance in late March and part of April as it pulled back to the 50-day moving average. Shares found support and resumed their advance. The ETF is currently too extended from buy areas, so investors must wait for a new opportunity to emerge on the chart.

IShares Poland Capped owns about 35 stocks traded in the Warsaw Stock Exchange. It's called a capped ETF because no single component can exceed 25% of the portfolio, and all components with more than a 5% weighting must not exceed 50% of the fund's total weighting.

More than 40% of the portfolio is invested in financial firms, with nearly 20% in energy companies and 11% in materials. The single largest holding, with 12% of the fund's weighting, is Polski Koncern Naftowy Orlen, an operator of refineries and gas stations that also provides aviation fuel, heating oil and other products.

The ETF has performed better than the WIG index this year. EPOL is up more than 30% and up nearly 40% in the past 12 months. The WIG is up about 30% in the past 12 months. In November, iShares Poland ETF began a sharp recovery after a deep slump that began in November 2013. Shares sank as much as 52% in that period.

Investing abroad involves certain risks that domestic investors don't face. As the ETF's prospectus warns, Poland's economy (the largest in Central Europe) depends largely on exports of raw materials and consumer goods. "As a result, Poland is dependent on trading relationships with certain key trading partners, including Germany and other EU countries."

In a report last November, the Organisation for Economic Cooperation and Development forecast GDP growth of 3% a year in 2017-18. Poland is trying to catch up with Europe's developed nations in terms of living standards and economic growth, says the World Bank, but must leverage technology and cope with a rapidly aging population.

Van Eck Cuts Fees On Two Interational ETFs

Van Eck Global, the New York-based investment manager most known for natural resources investing, lowered expenses -- at least until May 1, 2012 -- on two of its country ETFs, one focused on Indonesia and the other on Poland. The price changes were effective Jan. 26.

The funds and the price cuts are:

• The Market Vectors Indonesia Index ETF (NYSEArca: IDX) now has a net expense ratio of 0.60 percent, compared with 0.68 percent previously.
• The Market Vectors Poland ETF (ticker: PLND) also now has a net expense ratio of 0.60 percent, compared to 0.65 percent previously.

“International funds generally have higher net expense ratios than domestic funds but we try to pass on lower expenses to shareholders as we achieve economies of scale,” Jan van Eck, principal at Van Eck, said in a press release.

San Francisco-based iShares market Indonesia ETFs as well. Both the MSCI Poland Investable Market Index Fund (NYSEArca: EPOL) and the MSCI Indonesia Investable Market Index Fund (NYSEArca: EIDO) have annual expense ratios of 0.61 percent, according to iShares’ website.

As of Jan. 27, assets in the four different funds were:

• $480.6 million for Van Eck’s IDX
• $65.9 million for Van Eck’s PLND
• $213.8 million for iShares’ EIDO
• $107.4 million for iShares’ EPOL.

list of international ETFs here

Emerging Markets : Poland

Currently, there are two U.S.-listed ETFs that offer broad-based exposure to the economies of Eastern Europe, including the MSCI Emerging Markets Eastern Europe Index Fund (ESR) and the SPDR S&P Emerging Europe ETF (GUR). However, for investors looking for more pure play exposure on the surging Polish economy, the following two ETFs represent intriguing choices:

iShares MSCI Poland Investable Market Index Fund (EPOL)
This fund from iShares launched in late May of 2010 has already managed to gain close to $75 million in assets. EPOL tracks the MSCI Poland Investable Market Index, a free float adjusted market capitalization-weighted benchmark designed to measure the performance of stocks listed on exchanges in Poland. Unlike many emerging market funds, EPOL isn’t dominated by mega cap stocks; 38% of assets go towards large caps and 42% to mid caps. From a sector perspective, the fund is heavily concentrated in financials–which make up close to half of assets–with large weightings also going towards industrial materials (13%) and energy (13%) firms.

Market Vectors Poland ETF (PLND)
The original ETF tracking the Polish markets, this fund from Van Eck follows the Market Vectors Poland Index, a diversified benchmark consisting of about 25 companies either headquartered in Poland or deriving at least 50% of their revenues from the country. Currently, the fund maintains heavy weightings towards the financial (37%) and energy (17%) sectors. In terms of top holdings, copper and silver miner KGHM Polska Miedz (8%) takes the top spot and is closely trailed by two banks: PKO Bank Polski S.A. (7.7%) and Bank Polska Kasa Opieki S.A. (7.4%).

more on emerging markets ETFs, see http://www.artremis.com/article/etf_emerging_markets.html

Poland: World's 18th Largest Economy Finally Has ETF Tracking It

New York-based Van Eck launched on Wednesday the Market Vectors Poland ETF (PLND), a fund that will track the 26-company Market Vectors Poland Index. PLND will trade on the NYSE Arca Exchange and charge an expense ratio of 0.76%. 


Unlike most single-country international ETFs, which tend to be dominated by holdings in multi-national mega-cap companies, PLND offers exposure to companies of all sizes: according to its fact sheet, 41% of the underlying index is composed of companies with a market capitalization greater than $5 billion, with almost 50% in mid-caps.

To be included in the index, companies must have a market cap of $150 million or more and trade at least 250,000 shares a month.

Financials, weighted at 40%, are the largest sector, then energy 14%, industrials 11%, consumer staples 9%, basic materials 8%, telecom 7%, consumer discretionary 7%, telecom 4.5% and health care 1%.

Investing In Poland
Poland is the world’s 18th largest economy by 2008 GDP, making it surprising that there hasn’t been a pure play ETF prior to PLND. The void is even more confusing considering that #43 (Chile – ECH), #44 (Vietnam – VNM), and #50 (Israel – EIS) on the list are the subjects of country-specific ETFs. Poland is a shining example of a country that successfully transitioned from a centrally-planned economy to a capitalist market-based economy, thanks in large part to aggressive policies implemented since the fall of communism.

Poland’s economy certainly faces some hurdles. Its adoption of the euro has been shelved due to a failure to meet entry requirements set forth by the EU, and a once ambitious government has seen several initiatives sputter. Poland’s public debt could breach the threshold set by Polish law by exceeding 55% of GDP next year. Prime Minister Donald Tusk is now focusing on more manageable domestic agenda items, such as improving transportation infrastructure, increasing internet access, and gearing up for the 2012 European soccer championship.

Despite these obstacles, there are some reasons to be bullish on Poland. “Poland is the largest and fastest growing economy in Central and Eastern Europe,” said Jan van Eck, principal of Van Eck Global. “Poland’s economy has recently surpassed Belgium and Sweden and is one of the only economies in the CCE region to show positive growth this year.”

Poland’s local economy accounts for approximately 70% of GDP, allowing the country to come through the recent recession unscathed, at least relative to more export-dependent countries. Poland also has one of the lowest corporate tax rates in Europe and and a young, educated workforce, making the country an ideal location for multi-national firms looking to expand their reach into Europe.

more at http://www.vaneck.com/index.cfm?cat=3192&cGroup=ETF&tkr=PLND