Ishares Inc Mcsi Chile Index Fund (NYSEMKT:ECH)

CAPS Rating: 4 out of 5

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Player Avatar AjOrellana (< 20) Submitted: 3/4/2011 9:04:49 PM : Outperform Start Price: $67.81 ECH Score: -73.60

This ETF experienced a serious pullback since it peaked late in 2010. However, this only provided with an opportunity to increase the holdings of this Chilean superstar. There are a number of reason will I think this EFT will outperform the S&P 500. First, the Chilean economy is fundamentally strong, with a fiscally conservative government, and hawkish central bank. Second, Chile has primarily benefited from substantial increases in copper prices(Chile is largest exporter of copper). Now this is the main reason why I am extremely bullish on ECH: China( and other emerging economies) are growing like crazy, and there are consumer raw materials in vast quantities. Chile's exposure to Chinese growth will benefit the Chilean economy. As the Chilean economy continues to grow so will its other sectors(such as utilities, industrial, materials, and consumer staples)

ECH industry breakdown:

Utilities    22.23%
Industrials    19.98%
Materials    19.81%
Consumer Staples    13.64%
Financials    12.43%
Consumer Discretionary    8.11%
Telecommunication Services    2.68%
Information Technology    0.99%
S-T Securities    0.17%

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