Why Not an Indonesian ETF?
Tom Lydon of ETF Trends poses the question of why not an Indonesian exchange-traded fund? Although Indonesia has yet to get its own exchange traded fund (ETF), one of way to invest in this rapidly growing economy is through its closed-end fund (CEF), which is the Indonesian Fund (IF). It was perhaps the best performing country fund in 2006 and is up 17.3% year-to-date and is up 2% so far today but investors should note that it is trading at an 18% premium to its net asset value. It also has a large concentration in one stock with almost 25% of its assets in Indonesian Telecom. Despite Indonesia’s devastating loss from the tsunami, it’s economy is rebuilding at an impressive rate, and its closed-end fund (CEF) reflects this. Indonesia’s economy grew 5.5% last year and is expected to grow 6.2% this year and 6.5% next year, according to Assif Shameen of Barron’s. In addition, corporate earnings are projected to grow 23% this year and more than 20% next year, which would be the best perfor
