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Market Vectors JP Morgan EM LC Bd ETF Message Board

  • jettheroux jettheroux Sep 22, 2011 1:35 PM Flag

    why the 15% drop?

    No holdings in Euro countries, little in BRIC, so why the drop to new lows?

    As of September 21, 2011
    Credit Rating (S&P) Weight
    Brazil BBB+ 10.0%
    Poland A 10.0%
    South Africa A 10.0%
    Mexico A 10.0%
    Malaysia A+ 9.2%
    Turkey BB+ 8.9%
    Indonesia BB+ 8.2%
    Russia BBB+ 7.3%
    Thailand A- 7.1%
    Hungary BBB- 5.9%
    Colombia BBB+ 4.2%
    Peru BBB+ 3.2%
    Chile AA 3.0%
    Philippines BB+ 3.0%

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    • I really don't get it ether. The selling seems overdone based on the holdings. US Dollar strength does not help this ETF. Looks like people are moving into US Treasuries and Cash (US Dollars) and selling everything else. The yield is now around 6.24% with much lower debt to GDP levels for these countries vs. US T-Bills. This ETF is due for a nice bounce once the panic selling is over. I am adding to my position and averaging down. I am down a few percent but probably close to even with all the dividends I have collected over the past year or so. Longer tern their will be more US Dollar weakness once this EURO mess resolves itself, Greece defaults and the world moves on to the next crisis.

      • 1 Reply to cnoteoncloud9
      • Why the selloff: simple answer: FEAR

        As W. Buffet suggests: "When the market fears, you should be greedy. And when the market is greedy, you should fear.
        Or something like that.

        My opinion about the drop is investors are running away from risk and going into dollars and US treasuries. A classic move. But if you are in for a long haul, several years at least, no reason to fear the drop in price. Emerging markets will be a with us in the global economy upon the next expansion phase. Sit tight and enjoy your divy.

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