syahrir maulana There are various ways of gaining exposure to Brazilian companies, the main one being through the iShares MSCI Brazil ETF ( EWZ ), which includes the country's main companies, most of which are commodities and banks, such as Vale ( VALE ), Petrobras ( PBR ), Itau Unibanco ( ITUB ) and others. However, the way we'll be dealing with this article is through the iShares MSCI Brazil Small-Cap ETF ( NASDAQ: EWZS ), which is exposed to Brazilian small-cap stocks. With this asset, you can be exposed to a diversified basket of stocks in many segments, but with some common features, such as greater sensitivity to the macroeconomic scenario, greater possibility of growth, companies with a slightly higher beta, and the like.
This possibility of greater gains comes hand in hand with greater risks, such as companies more susceptible to the country's economic deterioration and more leveraged. Among the main triggers for me to write this article are: 1. This ETF looks dirty cheap when compared to its track record; 2.
The macroeconomic environment is bad but should improve eventually, making it an attractive option for value investors with a longer investment horizon. ETF Overview and Main Exposures Before going into the triggers, let's go through an overview of the ETF, which is extremely important for determining the risks and opportunities. Sectorally, we have Industrials as the largest, with 26%.
Here, there are a number of different companies, such as Embraer ( ERJ ), whi.